Strive Masiyiwa’s Liquid Telecom, Africa’s largest fibre network provider, has raised US$307 million from shareholders to expand its data centre business.
The new money includes an additional US$40 million equity investment from the CDC Group, the UK’s development finance institution.
This is CDC’s second investment in Liquid, after a US$180 million equity investment in 2018, which gave CDC a 10% stake in Liquid.
Liquid plans to use the new funds to expand its pan-African data centre operation business, Africa Data Centres, at a time demand from large tech companies such as Amazon and Google for data storage and cloud-based applications on the continent is growing.
“CDC’s additional equity investment into Liquid Telecom represents another crucial step in connecting businesses in Africa, with Liquid Telecom at the forefront of the continent’s eruption in technology adoption,” said Nic Rudnick, CEO of Liquid Telecom.
“Africa has significant untapped economic potential that is being unlocked by improving connectivity, data storage and the use of cloud-based applications. This investment will bring significant economic benefits to developing markets across the continent.”
Tony Morgan, CDC’s managing director for Direct Equity said: “Our aggregate investment to Liquid Telecom now stands at US$220 million, this will play an important role in addressing the increasing demand for digital services and help close the digital divide between Africa and other regions. Investing in Africa’s digital infrastructure is vital for building resilience within African economies and accelerating their growth.”
According to Liquid, less than 20% of potential telecommunications enterprise demand is being served in Africa, with London having three times more cloud computing power available than the entire continent.
Liquid Telecom says its data centres would boost economic activity by reducing IT related costs for companies.
Increased local capacity will also spur innovation by offering affordable data storage and Software-as-a-Service applications to SMEs.
Additionally, the company’s cloud-based services will also help accelerate the growth of Africa’s tech start-up ecosystems while also supporting the needs of established enterprises across the continent.