Pipeline Project

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Disclaimer

Please take note that the opinions, facts, data, statistics and any other information and/or recommendations contained in this document (“information”) have been prepared by the employees and/or representatives of Barak Fund Management Limited, Barak EU Fund Management Limited, Barak Fund SPC Limited, Barak Private Credit Fund SPC Limited and/or their affiliate companies (whether shareholders, subsidiaries or group entities) (collectively “Barak”) from the latest information available to them. However, all information provided in this document or otherwise provided to you is for informational purposes only and under no circumstances shall same constitute investment advice.

Past performance cannot be relied on as an indicator of future performance. Investment performance will depend on the growth in the underlying assets, which will be influenced by many factors including but not limited to, inflation levels in the economy and prevailing market conditions. This document has been provided to you solely for your information and background and is subject to amendment at any time by Barak without notice to you. Neither Barak nor any of its employees, agents, officers, directors or representatives make any warranties whatsoever with regard to expectations of success should any information contained herein be implemented or relied upon. You confirm that, should you choose to act on or have any queries with regards to the information, you will consult with your professional advisors. Neither Barak nor any of its employees, agents, directors, officers or representatives will be held liable for any costs or damages whatsoever (and howsoever arising) suffered by any person that may arise from the use or distribution of this document or any of the information contained here.

All information is furthermore subject to copyright and constitutes information proprietary to Barak. The information may be used by you solely for personal and information purposes and may not be relied upon as financial advice. You may not copy, distribute, disseminate or reconstruct the information in any medium and in any manner whatsoever for the purposes of publication thereof to any third parties.

This document and any materials distributed in connection with this document may include forward-looking statements. Forward-looking statements may be indicated by words such as “may,” “will,” “would,” “should,” “expect,” “intend,” “estimate,” “anticipate”, "believe" and similar expressions and/or their negatives. These forward-looking statements are statements regarding Barak’s intentions, beliefs or current expectations concerning, among other things, Barak’s results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which Barak operates. By their nature, forward-looking statements involve risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future. Barak cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition, liquidity and the development of the industry in which Barak operates may differ materially from those made in or suggested by the forward-looking statements contained in the presentation.

In addition, even if Barak’s results of operations, financial condition, liquidity and the development of the industry in which Barak operates are consistent with the forward looking statements contained in this or any other document, those results or developments may not be indicative of results or developments in future periods. Barak does not undertake any obligation to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise after the date of this document. This document and any materials distributed in connection with this document are not directed to, or intended or distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation which would require any registration or licensing within such jurisdiction.

Disclaimer

Please take note that the opinions, facts, data, statistics and any other information and/or recommendations contained in this document (“information”) have been prepared by the employees and/or representatives of Barak Fund Management Limited, Barak EU Fund Management Limited, Barak Fund SPC Limited, Barak Private Credit Fund SPC Limited and/or their affiliate companies (whether shareholders, subsidiaries or group entities) (collectively “Barak”) from the latest information available to them. However, all information provided in this document or otherwise provided to you is for informational purposes only and under no circumstances shall same constitute investment advice.

Past performance cannot be relied on as an indicator of future performance. Investment performance will depend on the growth in the underlying assets, which will be influenced by many factors including but not limited to, inflation levels in the economy and prevailing market conditions. This document has been provided to you solely for your information and background and is subject to amendment at any time by Barak without notice to you. Neither Barak nor any of its employees, agents, officers, directors or representatives make any warranties whatsoever with regard to expectations of success should any information contained herein be implemented or relied upon. You confirm that, should you choose to act on or have any queries with regards to the information, you will consult with your professional advisors. Neither Barak nor any of its employees, agents, directors, officers or representatives will be held liable for any costs or damages whatsoever (and howsoever arising) suffered by any person that may arise from the use or distribution of this document or any of the information contained here.

All information is furthermore subject to copyright and constitutes information proprietary to Barak. The information may be used by you solely for personal and information purposes and may not be relied upon as financial advice. You may not copy, distribute, disseminate or reconstruct the information in any medium and in any manner whatsoever for the purposes of publication thereof to any third parties.

This document and any materials distributed in connection with this document may include forward-looking statements. Forward-looking statements may be indicated by words such as “may,” “will,” “would,” “should,” “expect,” “intend,” “estimate,” “anticipate”, "believe" and similar expressions and/or their negatives. These forward-looking statements are statements regarding Barak’s intentions, beliefs or current expectations concerning, among other things, Barak’s results of operations, financial condition, liquidity, prospects, growth, strategies and the industry in which Barak operates. By their nature, forward-looking statements involve risks and uncertainties, because they relate to events and depend on circumstances that may or may not occur in the future. Barak cautions you that forward-looking statements are not guarantees of future performance and that its actual results of operations, financial condition, liquidity and the development of the industry in which Barak operates may differ materially from those made in or suggested by the forward-looking statements contained in the presentation.

In addition, even if Barak’s results of operations, financial condition, liquidity and the development of the industry in which Barak operates are consistent with the forward looking statements contained in this or any other document, those results or developments may not be indicative of results or developments in future periods. Barak does not undertake any obligation to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise after the date of this document. This document and any materials distributed in connection with this document are not directed to, or intended or distribution to or use by, any person or entity that is a citizen or resident or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation which would require any registration or licensing within such jurisdiction.

Data Room

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01

INVEST IN AFRICA: OPPORTUNITIES FOR GROWTH

Africa remains a vast region of uncorrelated, risk-adjusted investment opportunities

Africa’s Growth in Context

Why Africa will provide the growth going forward

With a wealth of natural resources, developing infrastructure, and improving business environment – in addition to a working population of 600 million, set to double by 2040 – Africa has emerged as an attractive investment destination and a key market for trade. The premium for investment is ripe provided an asset manager possesses the skills and experience to take advantage of this business environment, and this is exactly where Barak has positioned itself. However, post-crisis regulation and the resulting trade finance gap is halting its progress.

The African Development Bank estimates this African trade finance gap to be between US$110 – 120 billion, leaving many trade-reliant companies in Africa of all sizes in dire need. Hardest hit are the SME companies within the continent, many of whom largely contribute to the functioning of Africa’s smaller countries’ economies. Barak truly believes the rate of return on its investments in Africa, from its historic short-term activities to its looking ahead at longer-term strategies, will continue to abound and the Barak Team remains committed being the leading alternative financier in the region.

  • 6/10

    SIX OF TEN ECONOMIES FORECAST TO GROW THE MOST IN 2018 AND 2019 ARE IN AFRICA

  • 2040

    WORKING POPULATION OF 600 MILLION SET TO DOUBLE

  • 2050

    World’s leading consumer market

  • 50%

    of africa’s workforce is under the age of 20

Key points of business

Key points of business A MORE TRANSPARENT INVESTMENT ENVIRONMENT

Barak Fund Management has realised that doing investment in Africa has required extensive due diligence on the continent to understand the opportunistic landscape of the investment environment.

  • Rising GDP

    Africa is the second-fastest-growing region in the world. We believe that the rate of return on investment is higher than anywhere else in the world.

  • Huge Appetite

    Africa is now in the age of consumerism with the prediction of being the world‘s leading consumer market by 2050. This provides 30+ years to ensure investments have the maturity time to peak.

  • Doing business in Africa is now easier

    Home to more international private firms due to the increasing adoption of seamless business policies, lowered corporate taxes, and strengthened regulatory and legal systems in some African countries.

  • Largest, youngest workforce

    Africa is endowed with the worlds youngest population, which offers the continent a chance to reap a demographic dividend by using its young workforce to boost economic growth.

  • Rising technology

    Africa has leapfrogged into the digital age, sustained by low internet rates, increasing mobile penetration connectivity and mobile apps, which are reshaping youth culture and creativity.

  • Traditional Liquidity Constraints

    Banks are highly risk averse and thus proving difficult for borrowers to find an avenue of financing that is easy to come by. Alternative financiers in Africa are operating in a niche market.

Growth in Context

The importance of Portfolio Diversification: Bank’s Average Non-Performing Loans (NPLs) Ratio by African Sub-Regions. As Barak has grown its overall assets under management across Africa, so has it diversification grown to extend to primary regions of activity including sub-Sahara Africa, East, West and Central Africa. Growth has extended to deal origination offices in South Africa, Kenya, Ghana and Ivory Coast.

4%
6%
7%
10%
12%
Southern Africa
Eastern Africa
Central Africa
Northern Africa
Western Africa
Development
  • Africa
  • 17% 66.0%
  • Asia
  • 40.1% 31.6%
  • Eastern Europe
  • 41.5% 26.8%
  • Latin America
  • 35.0% 41.6%
0%
50%
0%
Minor Obstacle
Major Obstacle

Projected to Outperform Asia in GDP Growth

The Extent to which access to Trade Finance forms an obstacle to a Company’s Exports, broken down by region.

problematic factors for doing business in sub-saharan africa

Barak has identified that through a robust, experienced and extensive due diligence process as well as maintaining an on-the-ground risk-management structuring and presence in Africa, the above risk factors of doing business in Africa are largely mitigated against.

The Barak investment team has built of years of knowledge to approach all investment opportunities with keeping an open mind toward every possible risk factor on the continent.

Development
  • Access to finance
  • Corruption
  • inadequate supply of infrastructure
  • inefficient government bureaucracy
  • tax regulations
  • Tax rates
0%
5%
10%
15%
20%

Overview

BARAK’S LARGE OPPORTUNITY SET

The current emerging market environment and investment landscape in Africa has generated multiple opportunities for Barak since 2009, and is projected to continue to scale in the future.

Increasing global demand for farmland

Competition for land is likely to grow as food security becomes a priority for governments around the world.

Demand for agricultural products continues to grow significantly in local African markets and other emerging markets as populations grow and standards of living rise.

Lack of sophistication and transparency

Many local commodity assets are undervalued because of the lack of pricing transparency.

General misconceptions regarding the level of political and economic risk for the continent as a whole.

Africa offers untapped supply

Commodities are nearing price levels close to production parity, shifting focus to developing markets for future production.

Africa offers more than half of the world’s unused, agriculturally suitable land; by some estimates, only 45-50% of the continent’s potential arable land has been cultivated.

The World Bank’s projected industry size for agriculture and agribusiness in Sub Saharan African by 2030 is USD 1 trillion, compared to USD 313 billion in 2010.

Poorly serviced market

Post-2008, large banks pulled out of the market as they viewed Africa as uniformly high-risk.

Fragmented markets of smaller growers and traders exist across multiple countries.

Many businesses are too small to access larger, traditional lenders, and if they do, they often encounter a higher cost of capital or cannot gain credit approval.

Increasing demand for infrastructural development

Africa has seen increased Foreign Direct Investment from numerous sovereign institutions and investors in the past two decades, and this demand continues to rise. Developmental Finance Institutions continue to show heightened interest, as well as the increased financing and on-the-ground presence of China.

For more information on investment opportunities

Barak has built up a strong and ever-growing base of Fund investors across a wide range of regions globally. The Barak Investor team would love to hear from you.