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Monday, 13 March 2023

Metito + BII launch investment platform to tackle water insecurity in Africa

Metito + BII launch Africa water investment platform: Dubai-based water and wastewater treatment player Metito and the UK’s development finance institution, British International Investment (BII), yesterday launched an investment platform that will finance projects to improve water security across Africa, according to a joint statement (pdf).

A commercial model for investment in water infrastructure: The Africa Water Infrastructure Development (AWID) will target sustainable water projects at scale to address the funding gap in water security, Metito’s managing director Rami Ghandour and BII’s managing director and head of Africa Chris Chijiutomi said at the launch at the British Embassy in Cairo. The headquarters of the venture have not yet been set but AWID will initially operate from Dubai, Metito’s headquarters.

The JV has been seeded with two existing projects: The first is a desalination project in Sharm El Sheikh that since 1999 has provided 63 hotels with potable water and some wastewater management services. The second is a water treatment facility in Kigali, Rwanda, established two years ago. Future investments are already in the pipeline, Ghandour told Enterprise, without giving further details, saying that no specific timeline has been established.

AWID doesn’t have a fixed amount of capital: The financing provided by the two partners will be determined by the projects accepted, Ghandour told Enterprise, declining to disclose a specific figure. Metito and BII will split financing for AWID 60:40, with Metito contributing the majority, he added.

BII “is looking to commit anywhere between USD 1 and 2 bn across all our markets” in 2023, Chijiutomi told us. In 2021, the agency formed a similar joint venture with Dubai Ports World for projects in the African ports and logistics sector, with DP World committing some USD 1 bn and BII pledging over USD 700 mn in investments over several years.

AWID wants “bankable” and “investable” projects, Chijiutomi said. BII’s funds for AWID will either come in the form of direct investment or by mobilizing other commercial capital, he added.

BII is taking a long-term, patient approach: The high inflationary environment in Egypt poses an opportunity for BII, as a counter-cyclical investor, Chijiutomi said. The agency wants to invest long-term, patient capital, “which is what we think is required in this ecosystem” he added. Looking ahead, BII wants to explore investments in the green hydrogen and food and agriculture sectors in Egypt, as well as pharma, venture capital targeting the tech sector and SMEs.

Metito has a track record in Egypt’s water infrastructure industry: The company, alongside Hassan Allam Holding, Orascom Construction, and Arab Contractors, is developing the Al Mahsama agricultural drainage treatment plant. Focused on providing water infrastructure in emerging markets, Metito wants to take a “bold [investing] approach” that “brings in private sector capital,” Ghandour said. AWID will target Egypt as the government has positioned the water infrastructure and security as a key priority for its privatization strategy, he added.

British companies are keen on water projects in Egypt: UK company, British Water has recently signed an MoU with the Housing Development to provide smart water infrastructure to 42 new cities across Egypt, British Ambassador to Egypt Gareth Bayley added at the launch.

This story was amended on 15 March, 2023 to update figures on the investments BII is making in its joint venture with Dubai Ports World that Enterprise has since learned were not accurate. 

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