BluePeak Private Capital, a private credit fund house floated by former executives of Gulf Capital, has roped in a European Limited Partner (LP) for its debut fund to invest in Africa and parts of West Asia.
Dutch development finance institution FMO has approved $15 million as an investment in BluePeak’s maiden fund that is aiming to raise $200 million. FMO had previously disclosed it was looking to commit as much as $20 million.
BluePeak says it will apply a credit-oriented approach to evaluating investment opportunities. It aims to build a diversified portfolio of privately negotiated debt-like instruments, including mezzanine loans, preferred equity securities, high-yield debt securities, convertible and other similar income-producing securities.
Mezzanine financing consists of a blend between debt and equity financing. The instrument includes a fixed repayment schedule (like debt) and some upside participation (akin to equity) if the business is successful.
Tunisia-headquartered BluePeak was founded by Walid Cherif, Adam Hadidi and Rami Matar. All had previously worked at Abu Dhabi-based alternative investment firm Gulf Capital’s private credit business.
BluePeak intends to back companies that are generating more than $3 million in earnings before interest, tax, depreciation and amortization (EBITDA) and have revenue of over $10 million. The fund will look at non-cyclical industries and companies with robust cash flow generation. It will have an average investment size of $15-20 million.
The fund will provide growth capital to small and medium-sized companies in North, West and East Africa. It plans to deploy up to 20% of the corpus in West Asia. Its focus countries are Kenya, Tanzania, Ethiopia, Uganda, Ghana, Nigeria, Cote d’Ivoire, Senegal, Zambia, Morocco, Tunisia and Egypt.