** For the best experience, download the free Africa Private Equity News app Android | iOS **
TLG Capital has announced the $120 million second close of its TLG Africa Growth Impact Fund II (AGIF II).
The second close is led by Proparco and Calvert Impact Capital, a subsidiary of US-based impact investing firm Calvert Impact, alongside six additional new investors and increased allocations from several first close investors including Swedfund. AGIF II now includes 22 investors alongside a strategic partnership with the UK FCDO through its Manufacturing Africa programme.
In the year since the fund’s $75 million first close in April 2025, AGIF II has already invested in nine SMEs across seven countries and seven sectors, with debt facilities ranging from $5 million to $15 million to each company.
AGIF II finances African SMEs through a proprietary approach called BOMA – Bank Originated and Mitigated Assets – whereby TLG originates loans to African SMEs directly through local banking partners across the continent. Each loan is structured with a longer tenor than African banks typically offer and is backstopped by a guarantee from the originating bank, securing 100% of the principal.
“For over 30 years Calvert has been and continues to be incredibly selective with whom we form financing partnerships, particularly in jurisdictions and regions with elevated perceived and real risk characteristics,” said Maya Burney, senior officer at Calvert Impact. “TLG has demonstrated a unique ability to innovate whilst providing meaningful downside protection in line with what commercial private capital requires.”
“Financing SMEs in sub-Saharan Africa requires mechanisms that help mitigate credit risk and improve investment conditions for international investors,” said Tibor Asboth, head of Africa and Middle East private equity at Proparco. “Through its BOMA approach, TLG seeks to address some of these challenges by incorporating guarantees from African banking institutions. Proparco believes this structure may help expand financing opportunities for SMEs in frontier markets while offering an adjusted risk profile for investors.”
Jonas Tornblad, investment manager at Swedfund, added: “Through continued engagement with AGIF II, Swedfund helps address a critical financing gap for SMEs in Africa. Flexible and tailored credit solutions are directed to viable companies facing temporary cash flow constraints, safeguarding jobs while enabling businesses to recover, grow, and generate new sustainable employment opportunities.”
Want to know who is raising, investing, and exiting in Africa? Get Africa Private Equity News’ monthly Dealmaker’s Log – a database of reported investment deals, exits, and fundraising closes. Access the latest Dealmaker’s Log here