US Agency to Join $225 Million Investment in African Fiber Firm
A US development agency will be one of the main investors as African fiber company Liquid Telecommunication Holdings Ltd. seeks to raise $225 million in equity by the end of the year, according to Chief Executive Officer Hardy Pemhiwa.
The International Development Finance Corporation will be one of the biggest participants in a $90 million tranche in the next few weeks, while Liquid plans a second round later in the year, Pemhiwa told Bloomberg News in an email.
Geopolitical competition between the US and China is heating up in Africa, with its growing population and vast mineral resources, and development institutions such as the DFC are a key way to engage economically on the continent. Digital services in Africa are bridging gaps in countries that lack legacy infrastructure, even though it remains the least connected region in the world.
The fresh investment will assist Liquid to deal with looming maturities on loan and bond repayments coming up, with a $156 million equivalent term loan and $620 million bonds due in 2026.
Liquid is working with US tech giants Microsoft Corp. and Alphabet Inc.’s Google on broadband projects in east Africa, according to Pemhiwa.
The project with Microsoft aims to deliver affordable broadband through last mile connection to 20 million Africans across Kenya and Zambia, he said.
The infrastructure firm will also work with Google to build out terrestrial fiber that travels through South Africa, Kenya, Uganda, Rwanda, Zambia, Zimbabwe and the Democratic Republic of Congo. The route will provide connectivity to a number of data centers and an alternative option to deal with traffic in the event of a subsea cable outage between South Africa and Kenya, Pemhiwa said.
Liquid has laid over 110,000 kilometers (68,000 miles) of fiber across Africa as demand for higher-speed internet links and data storage increases.
