Using leverage from investment funds

Using leverage from investment funds

PROPARCO has been instrumental in building some of these teams and supports them over the long term - often via several successive funds - and as a local player by promoting market deepening. For example, in 2008 PROPARCO supported four management teams in the Mediterranean. These teams are implementing complementary strategies in order to promote better management and governance standards in firms and the emergence of regional champions. These operations conducted alongside investment funds also increase the impacts of PROPARCO’s investments and mean it can reach the whole small and mediumsized enterprise sector.

In 2008 the funds in which PROPARCO invested will support 92 businesses that employ 60 000 people. In terms of quality, theses businesses benefit from support that helps them extend their networks, improve their management systems, develop growth strategies and conquer new markets. Finally, PROPARCO is recognised for its high-level of requirements in terms of anti-money laundering and, more generally, for institutionalising the practices of these teams. It consequently creates confidence and has a knock-on effect on other private investors. In order to better evaluate the impact of its investments in these funds, PROPARCO encourages managers to use tools to monitor long-term evolutions in the businesses they finance as well as their effects on the ecological and social environment.

Our range of financial products in Morocco

In order to leverage raised capital and support locally established management teams, Proparco also invested in the capital of 7 dedicated investment funds in Morocco and the Maghreb region. These funds have financed some 80 businesses. Today, Proparco takes stakes in private equity funds, either directly or via Averroès, the fund of funds that it co-manages with France’s CDC.
Moreover, Agence Française de Développement allocates bank guarantees with subsidized rates in order to give SMEs/SMIs easier access to financing for their investment projects. The mechanism makes it possible to guarantee loans in both dirhams and euros.

Last update in September 2010