The largest FMCG platform in Ethiopia, SAMANU, has received a $21 million growth capital investment from Norfund and a group of private investors managed by 54 Capital.
The company plans to build sizable oilseeds clusters in Ethiopia over the next six years, generating jobs for 200,000 smallholder farmers, in order to ensure that there is an enough volume of locally produced oilseeds for its refineries. The goal is to locate 642 clusters and contract with about 5–7,000 smallholder farmers in the first six months after funding. Using grant money, Norfund intends to employ its Business Support Facility to provide contracted smallholder farmers with inputs like high-quality seeds, fertilisers, training, and capacity-building programmes, as well as agricultural technologies to increase productivity.
Why The Investors Invested
Andreas Davidsen, Norfund’s VP of Scalable Enterprises Agribusiness & Manufacturing, said: “We are excited to partner with SAMANU and support the execution of their vertical integration strategy, creating jobs and increasing food security. We strongly believe in the opportunities of local food production in Ethiopia and Norfund looks forward to working closely with the SAMANU management team and 54 Capital to help implement best in class practises and solutions”.
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SAMANU is already home to some of Ethiopia’s leading FMCG brands and has ambitious plans to expand its product offering to meet rising demand for high quality locally produced brands. The investment, Norfund’s first in manufacturing in Ethiopia, signals strong institutional backing for the platform.
Saad Aouad, 54 Capital PE Advisors’ Chief Investment Officer, said: “It is a fantastic achievement for our investments in Ethiopia and our local management team to receive further institutional backing. It stands as testament to what we have been able to achieve in terms of nurturing high-quality popular brands and achieving scale through capacity expansion and how we intend to develop the next stage of the business. This investment demonstrates the robustness of this strategy for further enhancing the value chain within Ethiopia. Which will undoubtedly benefit from Norfund’s extensive experience across the continent”
A Look At What The Startup Does
SAMANU is a platform business that competes in the primary FMCG sub-sectors in Ethiopia with well-known brands (Tena Edible Oils, 555 and Aura Soap & Detergents, and Chef Luca wheat products).
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With its investment, Norfund will support the development of a new solvent extraction facility for its refineries to create edible oils based on locally obtained sesame, sunflower, and soya beans. The investment intends to boost Ethiopia’s food security by decreasing the country’s reliance on imported raw materials and creating jobs in value-added industries. Increased export potential within the industries in which the company already works will also be made possible by the successful completion of a vertical integration project.
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer, who has several years of experience working in Africa’s burgeoning tech startup industry. He has closed multi-million dollar deals bordering on venture capital, private equity, intellectual property (trademark, patent or design, etc.), mergers and acquisitions, in countries such as in the Delaware, New York, UK, Singapore, British Virgin Islands, South Africa, Nigeria etc. He’s also a corporate governance and cross-border data privacy and tax expert.
As an award-winning writer and researcher, he is passionate about telling the African startup story, and is one of the continent’s pioneers in this regard