About the AVA Infrastructure Fund

The AVA Infrastructure Fund (“AVA IF” or “the Fund”) is a closed-end fund registered with the Securities and Exchange Commission. The Fund seeks to address the infrastructural deficits in Nigeria through the objective provision of institutional capital into infrastructure development.

  • Investment Objectives
  • Investment Criteria
  • Investable Instruments
  • Investment Benefits
Investment Objectives

The investment objective of the Fund is to provide unitholders with competitive returns on their investment by financing or investing in infrastructure or infrastructure-related projects, companies and SPVs primarily located in Nigeria and Pan-Africa.

The Fund will invest in a diversified portfolio of de-risked infrastructure projects that have high degree of certainty of future cash flows (including greenfield/brownfield projects, refinancing, acquisition financing), and seek to preserve the value of its deployed capital.

Proceeds of the Fund will be utilised to finance infrastructure project loans and securitised debt instruments of infrastructure companies or SPVs which are created for the purpose of facilitating or promoting financing of infrastructure.

The Fund may also invest in preference shares, convertibles including surbodinated/mezzanine financing instruments of companies engaged in infrastructure and infrastructure-related sectors.

The Fund will focus on senior secured debt collateralised with assets of the project being financed, where such collateralisation is available and feasible, or by other security to be provided by the project sponsors, as determined on a project by project basis by the Fund Manager.

Investment Criteria

The Fund will focus on projects with high market attractiveness by sponsors with a strong track record of delivery and market position.
Sponsors with a proven track-record of successful implementation.

  • Infrastructure segments with committed off-take contracts backed by guarantees/ISPOs, monopolistic in
    nature and high barriers to entry.
  • Segments with a significant supply-gap demand and clear route to market.

  • Clear legal and regulatory provisions underlying the project.

  • Clear procurement process and bankable construction and O&M contracts (with appropriate performance
    guarantees) by credible counterparties.

  • Clear alignment of incentives across stakeholders.

  • Backward integration projects aimed at extending. competitive advantage
Investable Instruments

The Fund is to invest in the following instruments:

  • Senior debt.
  • Subordinated/Mezzanine debt.
  • Convertible debt.
  • Preference shares.
  • Other instruments with suitable debt or equity structures
Investment Benefits

Below are the potential benefits investors in the fund may enjoy:

  1. Periodic Income: Due to the structure of the Fund and investments made by it, the Fund will have periodic
    contractual payments by the borrowers. This would enable the Fund to provide regular income streams to
    investors due to periodic distributions of income to its Unitholders.

  2. Socio-Economic Impact: Investors will be able to reduce the infrastructural deficits in various sectors of the
    economy through the Fund. The Fund’s investment in these critical sectors will have a positive impact on Nigeria’s economy.

  3. Access to Professional Fund Managers: The Fund has expert professionals with extensive experience
    in fund management, deal structuring, and the infrastructure industry, thus providing investors the opportunity to benefits from carefully selected investments by the Fund’s investment committee.

  4. Diversification: The Fund provides a unique investment opportunity to enable unitholders diversify their investments across various sectors of the Nigerian economy.

  5. Higher Yield: Unitholders would gain access to higher-yielding instruments across the capital structure of
    target infrastructure or infrastructure-related projects, companies or SPVs relative to publicly available fixed
    income instruments.

  6. Liquidity: The units of the Fund will be listed on an Exchange, enabling Unitholders to trade the Units.
    In addition, the various tranches would have a defined life after which investments will be liquidated and capital returned to investors. 

Frequently Asked Questions

  1. Is the Fund open-end or closed-end?
    The AVA Infrastructure Fund (“AVAIF” or “the Fund” ) is a closed-end fund registered with the Securities and Exchange Commission (SEC). This implies that units of the fund are only available for subscription to investors during an issuance usually in tranches or series for a defined issuance period.

  2. Is the Fund a debt fund or an equity fund?
    The Fund was raised from the debt capital market, which means that the Fund will be repaying its investors or unitholders on a bi-annual basis. However, the amount raised by the Fund can be invested into senior secured debt instruments or equity instruments but for the series 1 issaunce, most of the institutional loans to be given out to project sponsors will be senior secured debt.

  3. Who are the target investors of the Fund?
    Qualified Institutional investors as defined by the SEC include Pension Fund Administrators (Major Investor), High Networth Investors (HNIs), Asset Managers, Corporate Investors etc.

  4. What does the Fund invest in?
    The Fund invests in infrastructural projects that aim to address the infrastructural deficits in Nigeria by providing institutional loans/capital to such projects with the overall objective of driving the socio-economic growth in Nigeria.

  5.  What is the target return of the Fund?
    The Fund aims to achieve a target return of 3%-5% above the comparable FGN Bond of a ten-year tenor. This means that the Fund intends to give a return to its unitholders/investors on the money they invested but will be benchmarked and higher (3%-5%) than a 10-year FGN Bond tenor.

  6. What sectors is the Fund currently invested in?
    The Fund will be investing in 7 sectors which have been selected based on a thorough research into the Nigeria climate and we have been able to identify these sectors as we believe adequate investment in them will propel the socio-economic growth needed in Nigeria. They include; Telecommunications, Power, Gas Distributions, Processing and Storage, Transport, Urban and Social Infrastructure, Utilities (Water and waste management cycle), Agribusiness & supporting infrastructure etc.

Media & Publications