SA-based Vantage Capital closes 4th mezzanine fund worth $207m

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The South Africa-based VC firm Vantage Capital has launched its fourth mezzanine fund, which will provide mid-sized African businesses with flexible capital that will enhance job creation and facilitate much-needed economic opportunities and growth.

Founded in 2001, Vantage Capital is Africa’s largest mezzanine fund manager with offices in Johannesburg and Cape Town. The business has raised funds of over US$1.3 billion, and since 2006 its mezzanine division has made 31 investments across three funds into 11 African countries.

The firm has announced the successful first close on its fourth mezzanine fund, with US $207 million of commitments from European and US-based commercial investors as well as development finance institutions (DFIs) including IFC, CDC Group and SIFEM. Vantage Mezzanine Fund IV is on track to reach its target total fund size of US$350 million.

The fund will provide mid-sized African businesses with flexible capital that will enhance job creation and facilitate much-needed economic opportunities and growth – especially necessary for post-COVID-19 recovery.

“Vantage is proud of the continued support received from its investors. We were the first independent mezzanine fund in South Africa when we raised Fund I in 2006. Mezzanine was not well known in South Africa at that time, let alone in the rest of Africa. Since then, we have taken our mezzanine product across Africa to 15 target markets, having invested in 11 of them,” said Warren van der Merwe, managing partner of Vantage Capital. 

“Our fundraising success, in such a challenging environment, is a validation of the mezzanine asset class in Africa and of our role as a pioneer in this space over the past 15 years. As with previous funds, most of the funds have been raised from private sector investors such as insurers, pension funds and endowments who find our contractual yields and equity upside exposure attractive when compared to private equity alternatives.”

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