INCOFIN INVESTMENT MANAGEMENT A LEADER IN RURAL AND AGRICULTURAL IMPACT INVESTING COMMITTED BEYOND INVESTMENT
INCOFIN INVESTMENT MANGEMENT INVESTMENTS OFFICES 1 BELGIUM (ANTWERP) HEADQUARTERS 2 COLOMBIA (BOGOTÁ) OFFICE 3 INDIA (CHENNAI) OFFICE * 4 KENYA (NAIROBI) OFFICE 5 CAMBODIA (PHNOM PENH) OFFICE 2 1 4 3 5 * An independent advisory team contracted under a domestic private limited company u u A strong presence in microfinance, and pioneering initiative in Fairtrade u u Funds under management: USD 500 million EVOLUTION ASSETS UNDER MANAGEMENT 500 400 300 200 0 3 5 2003 2004 34 2005 72 2006 120 2007 223 228 2008 2009 407 407 2010 2011 434 2012 501 2013 A strong track record w w 700 microfinance transactions since 2003 An impact investment leader w w Winner of impact investing awards, ratings, and recognitions Member of the IA50 list: top 50 impact investment fund managers in the world LuxFLAG-labeled as a responsible investor in microfinance A strong investor base A team of 37 professional staff w w Multinational and a broad base of professional backgrounds Loïc de Cannière Managing Director Geert Peetermans Chief Investment Officer Rita Van den Abbeel Director Internal Control and Compliance Leslie Totté Chief Financial Officer Dominiek Deconinck Director Private Equity Sara Vermeir Director Business Development Ellen Wouters Chief Legal Officer David Dewez Regional Director Latin America & the Caribbean Aditya Bhandari Regional Director South Asia
agrif FUND u u The financing needs of smallholder farmers are largely unmet w w 450-600 million smallholder farmers worldwide have an estimated total demand for finance of USD 450 billion w w Only 2% of this demand is currently being supplied u u agrif fund target balance sheet Assets Equity investments (USD 95M) Liabilities Equity (USD M) u u agrif fund objective w w To provide an attractive return to its shareholders and to enhance financial inclusion of the rural population, particularly smallholder farmers w w In order to achieve this, the Fund will primarily invest in: Debt investments (USD 105M) USD 200M Senior notes & loans (USD M) USD 200M MFIs serving agri clients Banks serving agri clients Other FIs serving agri clients (leasing companies, educational financing, housing financing, ) Producer groups (coops, P.O.s, plantations) Photo credit: Didier Gentilhomme and Fairtrade International
agrif TERM SHEET Fund name Jurisdiction Structure Fund size Fund Manager Currency agrif Netherlands Cooperative Target size 200M USD Incofin Investment Management USD Closing First Closing minimum 50M USD target Q4 2014 Final Closing up to 18 months after First Closing Fund lifetime Investment period Closed ended, 10 years as of Final Closing (extendable with 2 times 1 year) 5 years (extendable with 1 year) as of First Closing Return Target net return to shareholder: 15-18% Senior notes Regions Issued with maturity of typically 5 years, pricing based on reference rate + spread Target regions: Africa, Latin American & Carribean, Central/Eastern Europe & Caucasus, Newly Independent states, South Asia, South East Asia Maximum investment in one region 35% Diversification Maximum country exposure 15% Maximum single client exposure 10% Size of investments Average target size of investments: 2,5-5M USD
EXPERIENCE IN RURAL AND AGRICULTURAL FUNDS u u Rural Impulse Fund I u u Rural Impulse Fund II Assets Liabilities Assets Liabilities Equity (USD 5M) Quasi-equity (USD 5M) Capital (USD 9M) Mezzanine debt (USD 10M) Equity and quasi-equity investments (55M EUR) Equity (60M EUR) Senior loans (USD 28M) Senior debt (USD 19M) Senior loans (65M EUR) Senior notes & loans (60M EUR) USD 38M USD 38M 120M EUR 120M EUR wkey w characteristics Launched in 2007: the first commercial Rural Impulse Fund Size: 38M USD Investments in rural MFIs in emerging countries w w Net asset value (NAV) evolution, 2007-2013 wkey w characteristics Launched in 2010 Size: 120M EUR Investments in rural MFIs in emerging countries w w Net asset value (NAV) evolution, 2010-2013 250 96 99 200 197 202 90 NAV/SHARE (USD) 150 95 134 136 153 IRR to date: 13,2% NAV/ SHARE (EUR) 80 70 81 88 NAV increase since 12/10: 22,5% 50 2006 2007 2008 2009 2010 2011 2012 2013 60 01/06/2010 31/12/10 31/12/2011 31/12/2012 31/12/2013 YEARS w w Funds disbursed to year-end 2013 Equity 4.1M USD Quasi-equity 3.9M USD Loans USD 84.5M USD w w 2.52 million served clients YEARS w w Funds disbursed to year-end 2013 Equity 33.5M EUR Loans 62.9M EUR w w 3.2 million served clients w w Average rural score: 67% w w Average rural score: 69% MFI = MICROFINANCE INSTITUTION
u u Social Performance Management (SPM) at Incofin IM wselection w MFIs are selected on both financial and social indicators, such as social transparency, client protection, human resources management wevaluation w Incofin IM has developed, and routinely employs, its ECHOS social performance evaluation tool to evaluate the social performance of its investee institutions The double bottom line is part of our identity and of our corporate DNA. LOÏC DE CANNIÈRE, Managing Director, Incofin IM ECHOS: the five SPM dimensions Social mission wdisbursement w In all legal documents Incofin IM foresees: * Investees reporting on SPM * Investees committing in implementing the Client Protection Principles u u Technical Assistance (TA) at Incofin IM w w Incofin IM organizes TA interventions to strengthen the capacity of its investees. Incofin IM has raised 6.5 M USD TA funding from various donors (such as AFD, EIB, FMO, Luxembourg Government, BIO and NMI). Incofin IM ensures: identification of TA needs of MFIs translation of requirements into terms of reference indentification of the best available experts worldwide monitoring of TA interventions 5 4 3 2 1 0 Environment & social practices Outreach and access Contact Sara Vermeir, Business Development Director sara.vermeir@incofin.com Dana Roelofs, Business Development Manager dana.roelofs@incofin.com Human resources Customer services THIS DOCUMENT IS SUBJECT TO UPDATING AND AMENDMENT. ANY INVESTMENT IN AGRIF WILL BE MADE SOLELY ON THE BASIS OF THE FINAL CONSTITUTIVE DOCUMENTATION OF AGRIF AND NOT ON THIS DOCUMENT. THIS DRAFT DOCUMENT IS OF A PRELIMINARY NATURE AND IS SUBJECT TO VERIFICATION AND AMENDMENT. IT SHOULD NOT BE REGARDED AS AN OFFER OR INVITATION TO PURCHASE INTERESTS OR SHARES IN AGRIF AND SHOULD NOT BE RELIED UPON BY ANY PERSONS FOR ANY PURPOSE. IT WILL BE REPLACED IN ITS ENTIRETY BY THE FINAL CONSTITUTIVE DOCUMENTATION OF AGRIF WHICH WILL BE SENT TO PROSPECTIVE INVESTORS AND WHICH MAY IN TURN BE AMENDED PRIOR TO FINAL CLOSING. PRIVATE AND CONFIDENTIAL, NOT FOR PUBLIC DISTRIBUTION