CDC, the UK’s development finance institution, invested $180m equity investment in Liquid Telecom, an independent fibre and cloud provider in Africa in a move expected to help it to expand broadband connectivity to some of the most underserved markets across Africa.
The funds will also be used by Liquid Telecom to support the continent’s thriving tech start-up ecosystem with high-speed internet and cloud-based services. This deal was concluded in December last year.
According to Nick O’Donohoe, CDC’s Chief Executive, “Digital infrastructure is still a major problem for Africa’s governments, people and its businesses, so improving access to affordable and quality internet is central to Africa’s development and economic growth. Our investment in Liquid Telecom – which is one of CDC’s biggest ever investments – plays an important part in addressing infrastructure bottlenecks and helps bring about the innovation and efficiency gains that result from better internet access.”
O’Donohoe added that CDC’s capital will enable Liquid Telecom to reach more countries in the continent, helping to connect millions more people and businesses.
Liquid Telecom has built Africa’s largest independent fibre network, approaching 70,000km, across 13 countries. It also operates state-of-the-art data centres and is a leading provider of cloud-based services across Africa. CDC’s investment will enable Liquid to for the first time connect Cape Town to Cairo, and to expand in Central and Western Africa, including some markets which lack affordable and reliable broadband today like the Democratic Republic of the Congo and Sudan.
This is CDC’s first direct investment in an African telecoms company in over twenty years and its largest single investment since it acquired the pan-African power company, Globeleq in early 2015.
CDC and Liquid Telecom will work together to create a double impact from the investment for expanded fibre infrastructure that improves access, quality and affordability for mobile broadband services. This will lower the cost of data and increase mobile broadband availability in countries like the DRC which had internet penetration of only 6% in 2016.
The two will also see expanded networks within countries to improve access and quality of fixed broadband for business customers. By raising the productivity of existing activities and streamlining business systems, improved fixed broadband increases economic efficiency across firms and workers.
Liquid Telecom serves mobile operators, carriers, businesses, media and content companies and retail customers with high-speed connectivity, hosting and co-location and digital services. it also offers cloud-based services, such as Microsoft Office365, Microsoft Azure and digital content products among others.
“We welcome CDC Group’s investment of $180M with Liquid Telecom since it will enable us to accelerate expansion along with our Cape-to-Cairo route and further into Central and Western Africa,” said Nic Rudnick, Group CEO, Liquid Telecom. “Once completed, it will bring significant economic and social benefits from providing access to online educational resources to supporting national economies, creating more jobs and driving the adoption of new technologies.”