CAPE TOWN, May 10 May 10 (Reuters) – Bob Geldof’s 8 Miles African private equity fund has made its first investment, backing a start-up company that plans to build commodity exchanges across Africa and improve food security.
The rock star activist’s $200 million fund has joined Morgan Stanley and the International Finance Corporation (IFC), in providing a total of $5 million of seed capital in eleni LLC, co-founded by Eleni Gabre-Madhin, the former head of the Ethiopia Commodity Exchange (ECX).
Gabre-Madhin set up Kenya-based eleni in January with the intention of levelling the playing field for African farmers in need of greater price transparency as they contend with powerful and better-informed market participants.
“We have closed (an agreement) this week with the 8 Miles fund,” she told Reuters on Friday at the World Economic Forum on Africa.
Gabre-Madhin aims to challenge the dominance of the world’s commodity markets by exchanges based in developed nations.
“It’s time the world looked to our markets as a reference,” she said. “There’s no reason why we shouldn’t have a west African cotton index that the world refers to, or an east African coffee index or African sesame seed index.”
Africa is on the cusp of an agricultural revolution, Gabre-Madhin added, with only a quarter of its yield potential achieved and 70 percent of arable land uncultivated.
To fulfil its potential in agriculture, Africa also needs to have structured trade, she said.
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Geldof’s Africa fund backs commodity exchange company
