Aavishkaar Capital (Aavishkaar), an Aavishkaar Group company and a global pioneer in taking an entrepreneurship-based approach to scaling businesses for impact, in partnership with KfW, a German state-owned investment and development bank, announced their second investment from the ESG First Fund in the form of a USD 5Mn loan to Hela Apparel Holdings PLC to fund their Africa growth strategy.
The investment is a part of Hela’s larger debt funding round involving a leading development financial institution and signals the company’s long-term commitment to manufacturing in Africa.
The ESG First Fund is a USD 250 Mn fund focused on investing in Africa and Asia with a mandate to generate superior Environmental and Social Governance (ESG) outcomes, with commercial and financial returns alongside positive social impact.
The fund’s first investment was in INI Farms, a leading exporter of fruits and vegetables with large-scale pan-India operations spanning contract farming, aggregation, supply chain management and retail.
Hela Apparel Holdings PLC provides sustainability-focused apparel supply chain solutions to some of the world’s leading apparel brands. The company works closely with global retailers, from design to delivery in the intimate wear, activewear and kids wear product categories.
With 10 manufacturing facilities across Sri Lanka, Kenya, Ethiopia and Egypt, and a workforce of 20,000 across the globe, Hela leads the industry in ethical and sustainable working environments.
“Hela was one the first major multinational apparel manufacturers to enter the African region in 2016, starting with just 250 employees in Kenya. We have since rapidly expanded our footprint and today employ approximately 10,000 people on the continent.
This investment by ESG First Fund will help us to continue this fruitful journey, particularly by supporting the expansion of our Egyptian manufacturing facility to its full scale. It is also another important example of the strategic partnerships we are forging with stakeholders who share our vision for Africa as a global manufacturing hub and we look forward to strengthening the relationship with Aavishkaar over the years to come.” said, A R Rasiah, Chairman of Hela Apparel Holdings PLC.
Commenting on the investment, Ashish Patel, Managing Partner, Credit, Aavishkaar Capital said, “We are excited to invest in Hela Apparel Holdings and in transforming the apparel and textile landscape in the region. Hela is emerging as an export powerhouse, producing to global standards and has immense opportunity in enabling large-scale job creation whilst building a robust sustainable business.
Aavishkaar Capital is excited to foray into credit and quasi-equity structures with the Aavishkaar ESG First Fund and we look forward to partnering with such high-growth businesses across Asia and Africa that are operating in global supply chains and are committed to providing them with non-dilutive, flexible financial solutions catered to their growth needs.
We are confident that this partnership with Hela will go a long way in creating employment opportunities, establishing Hela as a global exporter and in accelerating their business momentum.”
Stephanie Lindemann-Kohrs, Director, KFW Development Bank said the Mandate of KFW Development’s Equity and Fund business includes the development and backing of impactful businesses globally.
“Through our partners we improve and scale up the ESG standards of the respective investee companies. There is a significant opportunity for companies like Hela Apparel Holdings to cater to the growing demands of global consumers for sustainable products and to reach newer markets.
We believe this investment will have a transformative impact in the textile and apparel sector in Africa. This ESG First Fund will continue to focus on ecologically conscious sustainable businesses that also deliver significant employment opportunities.”