EXCLUSIVE: Every R50 million from a South African institution unlocks another R50 million from BII

British International Investment and Alexforbes each put R500 million into the Revego Africa Energy Fund in January, taking it to R3 billion. BII conditionally approved a further R250 million, subject to being matched locally. Speaking to ENN, Revego’s Chief Investment Officer Ziyaad Sarang says that match is still open.

R250 million from British International Investment is sitting available to the Revego Africa Energy Fund, conditional on a South African institutional investor matching it, and eight months after the commitment was made no match has concluded.

“That matching commitment from BII remains open,” Ziyaad Sarang, Revego’s Chief Investment Officer, told ENN. “We have not yet concluded a formal match, but we are in active discussions with a small number of South African institutional investors and those processes are ongoing.”

The structure behind it was built to catalyse exactly that participation, with every R50 million from a local investor unlocking a further R50 million from BII.

January was when the fund closed a R1 billion capital raise from BII and Alexforbes Investments, taking assets under management to R3 billion, and Revego buys renewable plants that are already generating rather than building new ones, so that a developer with capital locked into a twenty-year asset can release it and start again.

Conditions have worked against the match since. Persistent macroeconomic uncertainty and a cautious allocation stance have slowed capital formation across infrastructure and private markets globally, Sarang says, and South Africa is not immune to it.

Working the other way are recent pension fund regulation changes, which have widened the scope for local institutions to allocate to infrastructure, and the character of the assets themselves. Operating renewable plants offer the long duration, inflation-linked yield that those investors are looking for, which is the argument Revego is making to them.

“The broader message is one of momentum rather than a finished journey,” Sarang says. “South African institutional capital is moving towards renewable assets, but conviction is still building and allocation timelines remain measured. Deepening the secondary market, where investors can acquire proven, cash generative assets, is central to accelerating that shift and to recycling capital back into new generation capacity.”

Images: Revego