Catalyst Partners’ Private Equity arm “Catalyst Private Equity” announced the successful closing of its 2nd special purpose vehicle (SPV), Mozar’ II, with an internal rate of return (IRR) of 35%, following the success of its first agricultural investment vehicle, Mozar’, with an IRR of 32%.
Catalyst Private Equity launched its innovative series of mezzanine-structured financing vehicles, which is a hybrid of debt and equity financing, giving lenders the right to convert to an ownership or equity interest, Mozar’, in 2013 after identifying the funding gap, which exists in Egypt’s agricultural sector.
Mozar’ partners with planters in crop cultivation, as well as providing them with the financing required to optimise growth and subsequent yields.
Mozar’ II—which was a partnership between Catalyst Private Equity and Green Valley for Agriculture and Reclamation (Egypt’s largest producer of peanuts, with a strong regional brand presence—has achieved an average yield of 1.7 tonnes per feddan. This is 0.4 tonnes higher than Egypt’s average yield of 1.3 tonnes per feddan in 2016 (according to the United States Department of Agriculture). The total harvest of high-quality peanuts sold both locally and abroad was 6,800 tonnes.
“The success of this venture underlines the potentiality and scalability of Egypt’s agricultural sector, as well as medium-sized and family businesses in Egypt as a whole. We look forward to further supporting innovative medium-sized and family businesses in Egypt, which typically lack the funding and resources to take them to the next level,” said Abdelaziz Abdelnabi, Catalyst Partners’ co-founder.
Catalyst Private Equity is focused on developing scalable medium-sized enterprises and family businesses in Egypt and invests in fast-growing medium-sized/family companies, with the objective to exit each investment through an initial public offering within 1.5 to 3 years.