Solar Frontier Capital, a wholly-owned subsidiary of impact investment firm African Frontier Capital, and d.light, which makes solar-powered products, have created a $238 million financing vehicle.
Brighter Life Kenya 2 (BLK2) is an off-balance-sheet financing vehicle that provides d.light with flexible working capital, enabling the company to provide consumer financing and expand access to its products such as solar home systems to high-efficiency appliances and smartphones.
It is the largest off-balance-sheet facility in the industry thus far and has been structured to provide d.light with multi-currency financing over a two-year commitment period. It gives the company continued access to financing for its Kenyan business with a plan to expand to other African countries in the near future.
BLK2 is being partially financed by a $62 million senior lending facility supported by US International Development Finance Corporation, Norfund, responsAbility’s managed funds and Oikocredit.
AFC acts as the subordinated lender as well as the master servicer and back-up servicer under the transaction as well as the sponsor of the structure.
d.light CEO Ned Tozun said, “Establishing a large, scalable, multi-currency financing facility will enable millions of families to transform their lives through access to products that were previously out of reach. This facility paves the way for a long-term sustainable business model to bring affordable and transformative technology products to customers who are unbanked and without access to electricity.”
Founded in 2006 at Stanford, d.light enables financing with a “Pay As You Go” technology via solar energy solutions. It has sold over 25 million products including solar lanterns, solar home systems, TVs, radios and smartphones, impacting the lives of over 125 million people.