By Staff Writer
This is the second investment from Aavishkaar Capital’s USD 250 Million “ESG First Fund”
Aavishkaar Capital (Aavishkaar), an Aavishkaar Group company and a global pioneer in taking an entrepreneurship-based approach to scaling businesses for impact, in partnership with KfW, a German state-owned investment and development bank, announced their second investment from the ESG First Fund in the form of a USD 5Mn loan to Hela Apparel Holdings PLC to fund their Africa growth strategy. The investment is a part of Hela’s larger debt funding round involving a leading development financial institution and signals the company’s long-term commitment to manufacturing in Africa.
The ESG First Fund is a USD 250 Mn fund focused on investing in Africa and Asia with a mandate to generate superior Environmental and Social Governance (ESG) outcomes, with commercial and financial returns alongside positive social impact. The fund’s first investment was in INI Farms, a leading exporter of fruits and vegetables with large-scale pan-India operations spanning contract farming, aggregation, supply chain management and retail.
Hela Apparel Holdings PLC provides sustainability-focused apparel supply chain solutions to some of the world’s leading apparel brands. The company works closely with global retailers, from design to delivery in the intimate wear, active wear and kids wear product categories. With 10 manufacturing facilities across Sri Lanka, Kenya, Ethiopia and Egypt, and a workforce of 20,000 across the globe, Hela leads the industry in ethical and sustainable working environments.
“Hela was one the first major multinational apparel manufacturers to enter the African region in 2016, starting with just 250 employees in Kenya. We have since rapidly expanded our footprint and today employ approximately 10,000 people on the continent. This investment by ESG First Fund will help us to continue this fruitful journey, particularly by supporting the expansion of our Egyptian manufacturing facility to its full scale. It is also another important example of the strategic partnerships we are forging with stakeholders who share our vision for Africa as a global manufacturing hub and we look forward to strengthening the relationship with Aavishkaar over the years to come.” said, A R Rasiah, Chairman of Hela Apparel Holdings PLC.
Commenting on the investment, Ashish Patel, Managing Partner, Credit, Aavishkaar Capital said, “We are excited to invest in Hela Apparel Holdings and in transforming the apparel and textile landscape in the region. Hela is emerging as an export powerhouse, producing to global standards and has immense opportunity in enabling large scale job creation whilst building a robust sustainable business. Aavishkaar Capital is excited to foray into credit and quasi equity structures with the Aavishkaar ESG First Fund and we look forward to partnering with such high growth businesses across Asia and Africa that are operating in global supply chains and are committed to providing them with non-dilutive, flexible financial solutions catered to their growth needs. We are confident that this partnership with Hela will go a long way in creating employment opportunities, establishing Hela as a global exporter and in accelerating their business momentum.”
Stephanie Lindemann-Kohrs, Director, KFW Development Bank said “The Mandate of KFW Development’s Equity and Fund business includes the development and backing of impactful businesses globally. Through our partners we improve and scale up the ESG standards of the respective investee companies. There is a significant opportunity for companies like Hela Apparel Holdings to cater to the growing demands of global consumers for sustainable products and to reach newer markets. We believe this investment will have a transformative impact in the textile and apparel sector in Africa. This ESG First Fund will continue to focus on ecologically conscious sustainable businesses that also deliver significant employment opportunities.”
About Aavishkaar Capital:
Aavishkaar Capital is an Impact fund manager focused on the Global South. A pioneer in taking an entrepreneurship-based approach to scaling businesses for impact, Aavishkaar Capital’s unique approach has resulted in its invested enterprises impacting over 130 million lives. Aavishkaar Capital invests in sectors such as Sustainable Agriculture, Financial Inclusion and Essential Services across India, Emerging Asia, and Sub-Saharan Africa. Aligned to 13 out of the 17 Sustainable Development Goals, Aavishkaar Capital has raised eight funds, while generating commercial returns with over c.$500 million in assets under management.
Aavishkaar Capital is the impact investing arm of the Aavishkaar Group, an impact platform with presence in Microfinance, MSME Lending and ecosystem building across India, Emerging Asia, and Sub-Saharan Africa. Aavishkaar Group with its vision to bridge the opportunity gap for the emerging 3 billion, currently manages over USD 1 billion in Impact Assets across its platform. www.aavishkaarcapital.in
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KfW is a German promotional bank and one of the world’s leading promotional banks. It was founded in 1948 and is 80% owned by the Federal Government and 20% by the federal states.
The business sector KfW Development Bank carries out Financial Cooperation (FC) projects with developing countries and emerging economies on behalf of the German Federal Government. KfW Development Bank employs approximately 1,000 people at the head office in Frankfurt am Main and almost 400 specialists at more than 60 international locations, who cooperate with partners all over the world. Their goal is to combat poverty, secure peace, protect the environment and the climate as well as ensure fair globalisation. KfW is a competent and strategic adviser for current development policy issues.
For more information please visit: www.kfw-entwicklungsbank.de
Hela Apparel Holdings PLC is a social capital-focused company built on the principles of inclusivity, equity, and climate stability. With over three decades of industry experience, Hela focuses on building strategic partnerships with global brands to provide apparel supply chain solutions with distinctive advantages. The organisation has a global presence with 10 manufacturing facilities across Sri Lanka, Kenya, Ethiopia, and Egypt, as well as design centres in Sri Lanka, the US, the UK, and France, providing direct employment to over 20,000 people. Innovative, ethical, and sustainable apparel manufacturing is at the centre of Hela’s operations. With numerous accolades for sustainability, the organization was recently endorsed as a signatory to the UN Global Compact and was awarded the ISO 14064-1:2018 certification for quantification and reporting of greenhouse gas emissions across the Group.