Investment-Uganda - Tony Elumelu Foundation (TEF) together with Heirs Holdings Limited (HH), both Nigerian based firms, on recently announced their inaugural investment deal with Mtanga Farms Limited a Tanzanian based farm. Mtanga Farms was represented by London-based Lion's Head Global Partners and these acted as their financial adviser. MFL is a mixed arable farming business operating in the Southern Tanzanian Highlands that is focused on fighting food insecurity. It is currently planting wheat, barley, maize and certain oil crops. It has further established a livestock operation consisting of local cattle for fattening and a herd to cross breed higher quality cattle for premium meat. This deal marked the first time an African philanthropic organization and investment firm engaged together in impact investing, an approach that, unlike traditional grant-making, uses for-profit methods to solve intractable social and environmental problems in this case agriculture development.

Impact investing is TEF's primary tool for supporting Africa's small and growing businesses.

"Through impact investing, we seek to drive African economic growth from within by investing in businesses that generate social, environmental, and financial returns. This can also change the paradigm of how development takes place on the continent." said Tony Elumelu, founder and chairman of TEF. Besides the broader implications of the investment, the MFL deal will touch the everyday lives of thousands of low income people in rural Tanzania, improving farmers' access to inputs and technology, creating infrastructure for farmers to bring their products to markets and contributing to the development of the Southern Tanzanian Highlands. It will also help Mtanga establish a seed potato industry.

All of MFL's products and livestock are for domestic consumption and these will substitute imports, thus contributing to Tanzania's emergence as a major food commodity producer.

Dr Boer noted that the Mtanga investment is a prime example of African investors reaching across borders to inject capital into other economies, facilitate trade, and deliver new or improved products and services. MFL interacts closely with local farmers by sharing equipment, collaborating with the government to grow seeds and providing access to markets for local cattle herders.

Claire Balondemu

The Monitor/19/04/2011