New York, February 07, 2024 – Social Investment Managers and Advisors LLC (SIMA Funds or SIMA) announces the first close of $ 131 million of the $150 million SIMA Commercial & Industrial Solar Green Bond, which will finance small-scale productive-use solar projects throughout Africa.
The Bond would be one of the largest impact-driven funds exclusively focused on furthering the C&I solar landscape in Africa by offering short-term corporate financing and longer-term project financing up to 10 years to support the growth of the Small to Mid-size local African developers for individual projects less than 5MW. Moody’s has assigned the highest grading as part of their independent opinion on the bond’s sustainability.
Increasing access to clean and affordable energy in Africa is key for achieving the Sustainable Development Goals and enhancing climate resilience. SIMA Commercial & Industrial Solar Green Bond B.V (SIMA Solar Bond) will finance small-scale productive-use solar projects within the commercial and small industrial (C&I) sectors throughout Africa with an emphasis on manufacturing, services, education, healthcare, and agri-processing.
The Bond targets to finance over 220 MW of renewable energy projects to create sustainable access to energy combined with energy savings, enhancing the value chain efficiency, and reducing carbon emissions by an estimated 4 million tons over the life of the assets. Additionally, this initiative is set to support 44,000 productive jobs and dedicates at least 10% of the fund to lower-income countries.
Vinay Bandaru, Partner, SIMA Funds, elaborated, “C&I solar presents a great opportunity to solarize productive use sector and impactful institutions such as hospitals and educational institutions. We are not chasing deals but identifying good developers to partner with and to do multiple projects with them while also providing coordinated technical assistance to help create a sub-segment of SMA developers focused on projects of less than 5MW. This bond is unique with its ESG numeric scorecard, ensuring a clear, quantifiable impact on the environment, society, and governance. Our partnership with our marquee investors enables us to channel our innovative approach to financing to many interested developers in Africa’s Least Developed Countries.”
Asad Mahmood, CEO, SIMA Funds stated “SIMA has always been an innovator in the impact investment space. We aim to further our mission of creating value with a social objective for our investors and borrowers. C&I Solar Green Bond will add dimension to our mission of expanding energy access in the underserved markets and our work in the Solar Home Systems (SHS) and mini-grids space.”
Lenders for the $131 million first close include the International Finance Corporation (IFC) a member of the World Bank Group, The Finland-IFC Blended Finance for Climate Program, Global Energy Alliance for People and Planet (GEAPP), UK charity Shell Foundation (with co-funding from the UK government), the Schmidt Family Foundation, FMO, the Dutch entrepreneurial development bank, the German development finance institution (DEG), the Belgian Investment Company for Developing Countries (BIO), the Development Bank of Austria (OeEB) and the US Development Finance Corporation. SIMA expects a second close led by private sector investors for an additional $25 to $30 million by April 2024.
About SIMA Funds
Founded in 2016 by impact investment veterans Asad Mahmood and Michael Rauenhorst, Social Investment Managers and Advisors (SIMA) is an SEC-registered firm with a unique culture and business model. We have the largest number of relationships with energy companies in Africa. SIMA partners with diverse investors, crafting market-based opportunities with risk mitigation. Their focus spans solar energy, financial inclusion, and affordable housing, uplifting underserved communities. Learn more at www.simafunds.com.