Axian Telecom secures $600M in oversubscribed bond deal

The African digital landscape is buzzing with news of a significant financial milestone: Axian Telecom, a rapidly expanding pan-African telecommunications powerhouse, has successfully closed an oversubscribed $600 million bond issuance. This landmark achievement, anchored by a formidable coalition of leading Development Finance Institutions (DFIs), signals a robust vote of confidence in Africa’s burgeoning digital future and the critical role of strategic investments in bridging the continent’s connectivity gaps.

The Emerging Africa & Asia Infrastructure Fund (EAAIF), International Finance Corporation (IFC), British International Investment (BII), DEG, and Proparco collectively committed an impressive $160 million in an anchor investment to this five-year bond. This substantial backing not only de-risked the transaction but also paved the way for overwhelming demand from a diverse mix of institutional investors, with the bond attracting over $1.3 billion in orders – more than double the initial offering. The bond, offering an attractive 7.25% coupon, underscores the growing appetite for high-impact, growth-oriented opportunities across African markets.

The Powerhouse Partnership: Global DFIs Propel Axian’s Vision

A Coalition of Development Finance Giants

The collaborative effort of these five prominent DFIs highlights a strategic alignment towards fostering sustainable development and economic growth across Africa. Their combined anchor investment of $160 million was instrumental in providing the foundational stability and credibility that attracted the broader market. The remaining $340 million of the $600 million bond was swiftly raised from a mix of global institutional investors, a testament to both Axian Telecom’s strong performance and the increasing attractiveness of African telecommunications assets.

This oversubscription, reaching nearly three times the proposed amount, reflects a significant shift in global investor sentiment towards African frontier markets. It demonstrates a clear recognition of the immense potential for digital transformation and the robust returns that can be generated by well-managed, impactful companies like Axian Telecom.

Spotlight on the Anchor Investors and Their Mandates

Each DFI brings a unique mandate and a wealth of experience to this crucial investment, collectively reinforcing the bond’s developmental impact:

• Emerging Africa & Asia Infrastructure Fund (EAAIF): As a core part of the Private Infrastructure Development Group (PIDG) and managed by Ninety One, EAAIF is a pioneering blended finance vehicle. Its mission is to raise and deploy public and private debt capital into transformative infrastructure projects across Africa, the Levant, and South and Southeast Asia. EAAIF’s involvement goes beyond mere capital; it’s about catalyzing large-scale, high-impact infrastructure development in dynamic growth markets. The fund explicitly stated that its investment will support Axian Telecom’s capital expenditure across its subsidiaries, directly contributing to economic growth and providing improved digital infrastructure to millions. EAAIF has a proven track record, having previously backed Axian Telecom’s maiden $420 million bond issuance in February 2022 with a $20 million investment, which supported the company’s initial expansion into key frontier economies like Tanzania, Madagascar, and Togo. This continued partnership underscores their long-term commitment to Axian’s vision.
• International Finance Corporation (IFC): As the largest global development institution focused on the private sector in emerging markets, the IFC, a member of the World Bank Group, plays a pivotal role in mobilizing private capital, offering expertise, and fostering sustainable growth. The IFC’s participation in this bond reinforces its commitment to Africa’s digital transformation. Their strategy often involves de-risking investments through their participation, thereby encouraging other private investors to enter markets they might otherwise perceive as too challenging. For instance, the IFC recently announced a $100 million investment in Raxio Group to support the development of data centers across Africa, highlighting their strategic focus on foundational digital infrastructure.
• British International Investment (BII): The UK’s Development Finance Institution, BII, is a major investor in Africa, South Asia, and the Caribbean. Their mandate is to invest to create productive, sustainable, and inclusive economies. BII’s focus areas include digital infrastructure, recognizing its foundational role in economic development. They actively seek to improve access to information and communication technology (ICT) and support economic opportunities through investments in physical and digital infrastructure, including fibre, wireless networks, data centers, and the rollout of 5G technology. Leslie Maasdorp, the newly appointed CEO of BII, has emphasized Africa as BII’s largest regional focus, aiming to intensify work in frontier markets and leverage BII’s capital to attract further private funding.
• DEG (Deutsche Investitions- und Entwicklungsgesellschaft): As the German DFI, DEG has a long-standing commitment to private sector development in developing and emerging countries. Their investments aim to create jobs, generate local income, and improve living conditions. DEG’s participation in the Axian bond aligns with its strategy to support robust companies that contribute to essential infrastructure. They have a history of supporting African telecom operators, as evidenced by their anchor investment in Liquid Telecommunication’s $620 million bond, which aimed to expand fibre optic networks across sub-Saharan Africa.
• Proparco: A subsidiary of Agence Française de Développement Group, Proparco has been working with the private sector for over 45 years to build a more just and sustainable world. With a significant portion of its commitments directed towards Africa (45% in 2022, totaling €1 billion), Proparco offers a wide range of financial solutions tailored to different stages of business development. Their involvement in the Axian bond underscores their strategic focus on strengthening local physical infrastructures and financial systems, while also addressing environmental and social challenges.

Axian Telecom: A Force in Africa’s Digital Evolution

From Local Roots to Pan-African Powerhouse

Axian Telecom’s journey is a compelling narrative of strategic growth and ambition. Originating as a single-market player in Madagascar until 2015, the company has rapidly transformed into a formidable pan-African operator. This impressive expansion has been driven by a proactive strategy of active acquisitions and substantial network investments across the continent.

Today, Axian Telecom operates in eight key markets: Madagascar, Senegal, Tanzania, Togo, Uganda, Democratic Republic of the Congo, and Comoros. It serves a vast customer base of over 40 million mobile customers, providing a comprehensive suite of digital services. These include core telecommunications services, innovative mobile financial services, and robust digital infrastructure such as mobile broadband networks, extensive fibre optic cables, telecommunication towers, vital subsea cables, and modern data centers. Notably, Axian Telecom has been a pioneer, launching the first commercial 5G network in Africa and boasting over 17,200 kilometers of backbone infrastructure, a critical foundation for high-speed connectivity.

Impressive Growth and Strategic Investments

Axian Telecom’s financial performance has mirrored its operational expansion. The company experienced remarkable revenue growth of approximately 2.5 times between 2020 and 2023, solidifying its position among the fastest-growing companies in Africa. In 2023 alone, Axian Telecom reported a total revenue of US$1.1 billion, demonstrating its significant market presence and operational efficiency.

This latest $600 million bond issuance builds upon previous strategic financing efforts. In February 2022, Axian Telecom successfully issued its maiden $420 million bond, with EAAIF also playing a crucial anchor role. That initial bond issuance was pivotal in supporting the company’s strategic expansion into new “frontier economies” across the region, including significant investments in Tanzania, Madagascar, and Togo, laying the groundwork for the current phase of growth.

The Transformative Power of Blended Finance

Demystifying Blended Finance

The success of the Axian Telecom bond is a prime example of the effectiveness of “blended finance.” This innovative approach to development financing strategically combines public or philanthropic funds (often referred to as concessional capital) with private capital to fund sustainable development initiatives. The core principle is to use public or philanthropic funds to de-risk projects and make them more attractive to private sector investors who might otherwise shy away due to perceived high risks or lower-than-market returns in developing countries.

In essence, DFIs and other public entities absorb some of the initial risks or provide more patient capital, creating a more favorable environment for commercial banks, institutional investors, and pension funds to participate. This catalytic role is crucial for unlocking the massive amounts of private capital needed to address global development challenges, particularly in sectors like infrastructure.

Why Blended Finance is Crucial for Africa

For a continent like Africa, where infrastructure deficits are significant and traditional financing can be scarce or expensive, blended finance is an indispensable tool. It allows for the funding of large-scale, complex infrastructure projects that are vital for economic development but may not immediately offer the risk-adjusted returns sought by purely commercial investors.

DFIs, through blended finance mechanisms, provide the patient, long-term capital and often crucial technical assistance required to get these projects off the ground. By doing so, they not only facilitate direct investment but also build market confidence, demonstrate viability, and ultimately attract further private investment, creating a virtuous cycle of development and growth.

Africa’s Digital Horizon: Opportunities and Challenges

A Continent Ready to Leapfrog

Africa stands at the cusp of a profound digital transformation. The continent boasts the youngest and fastest-growing population globally, a demographic dividend that is inherently tech-savvy and increasingly reliant on mobile and digital services. This burgeoning demand creates an unparalleled opportunity for Africa to “leapfrog” outdated traditional infrastructure systems and build a digitally empowered future.

While fixed broadband penetration remains limited in many parts of Africa due to high costs and significant infrastructure gaps, mobile connectivity has emerged as the primary gateway to the internet. The continent has seen remarkable growth in mobile internet users, smartphone adoption, and especially mobile money services, which have revolutionized financial inclusion. This mobile-first approach means that investments in mobile broadband networks and supporting digital infrastructure are directly impacting millions of lives, enabling access to information, education, healthcare, and financial services that were previously out of reach.

Bridging the Digital Divide: Persistent Hurdles

Despite the immense opportunities, Africa’s digital journey is not without its challenges. The primary hurdle remains the underdeveloped infrastructure. Many regions lack adequate fibre optic networks, and inconsistent power supply is a pervasive issue that disrupts internet service providers and users alike. These infrastructural weaknesses contribute to a significant “digital divide,” particularly between urban centers and vast rural areas, where connectivity is often costly, unreliable, or entirely absent.

The absence of affordable and consistent internet access hampers not only communication but also limits access to vital resources. Small businesses in underserved areas struggle to expand, and individuals face barriers to online education, telemedicine, and digital financial services. Furthermore, digital literacy gaps in some communities mean that even where infrastructure exists, the full potential of digital tools may not be realized. Addressing these challenges requires sustained, targeted investment and innovative solutions, precisely where initiatives like Axian Telecom’s bond, backed by DFIs, play a crucial role.

The Impact Beyond Investment: Fostering Inclusive Growth

Strategic Allocation for Widespread Benefit

The $600 million raised through this bond issuance is earmarked for strategic investments that promise far-reaching benefits across Axian Telecom’s operational footprint. The funds will primarily be directed towards capital expenditure across its subsidiaries. This includes significant investments in expanding digital infrastructure, such as building more mobile broadband networks, laying additional fibre optic cables, and enhancing tower infrastructure.

Beyond physical infrastructure, a key focus will be on promoting smartphone accessibility, making digital tools more affordable and available to a wider population. Crucially, the investment will also bolster the expansion of mobile financial services, which have proven to be transformative for financial inclusion in Africa, allowing millions to access banking services, make payments, and conduct transactions securely via their mobile phones. These initiatives are not just about connectivity; they are about driving economic growth, fostering job creation, improving livelihoods, and empowering communities.

As Hassan Jaber, CEO of Axian Telecom, eloquently stated, the support from anchor investors is a “strong vote of confidence in the company’s long-term vision and the impact of its work.” He emphasized that “This financing enables us to scale innovative digital infrastructure across our markets and to bring transformative connectivity to millions, fostering inclusive growth and strengthening AXIAN Telecom’s role in advancing Africa’s digital future.”

A Commitment to Sustainable Development

Axian Telecom has demonstrated its commitment to responsible growth by including a sustainable development impact disclosure with the bond issuance. This transparency communicates its intentions to align its investments with broader development goals. By investing in infrastructure, promoting smartphone accessibility, and expanding mobile financial services, Axian Telecom directly contributes to several United Nations Sustainable Development Goals (SDGs), particularly:

• SDG 9: Industry, Innovation, and Infrastructure: By building resilient infrastructure, promoting inclusive and sustainable industrialization, and fostering innovation.
• SDG 8: Decent Work and Economic Growth: By creating economic opportunities, fostering entrepreneurship, and increasing productivity through enhanced digital access.
• SDG 10: Reduced Inequalities: By bridging the digital divide and ensuring that even underserved populations have access to essential digital services.

This integrated approach ensures that the financial returns are coupled with tangible, positive social and environmental impacts, aligning with the mandates of the DFIs involved.

Strengthening Africa’s Nascent Debt Capital Markets

Building Financial Resilience

The Axian Telecom bond issuance is more than just a financing deal for one company; it’s a significant development for Africa’s nascent debt capital markets. For telecommunications companies, issuing corporate bonds provides a crucial means for accessing substantial, long-term capital. This form of financing is often available at a lower cost compared to traditional bank loans, enabling large-scale network expansions and technology upgrades that are essential for meeting the continent’s growing digital demands.

Moreover, corporate bond issuances like this attract international investors, which in turn helps to deepen market liquidity and confidence. As more African companies successfully tap into global debt markets, it builds a stronger precedent and encourages further foreign direct investment. EAAIF, in particular, has been a consistent champion of this trend, having allocated over $320 million to telecom bonds to date, contributing to more than $6.2 billion raised in total across the sector.

Tidiane Doucoure, Director for Emerging Market Alternative Credit at Ninety One, the fund manager of EAAIF, highlighted this broader impact: “Expanding access to digital services unlocks new economic opportunities, and greater financial inclusion, which are crucial drivers for intra-African trade and entrepreneurial growth. This oversubscribed transaction underscores the immense potential of African businesses and the growing confidence of global investors in the region’s digital future and champions like Axian Telecom.” His comments underscore the dual benefit of such transactions: financing specific companies while simultaneously strengthening the broader financial ecosystem.

Conclusion: A Connected Future for Africa

The $600 million bond issuance by Axian Telecom, powerfully anchored by a consortium of leading Development Finance Institutions, marks a pivotal moment for Africa’s digital transformation. It is a resounding affirmation of investor confidence in the continent’s growth trajectory and the strategic importance of its telecommunications sector.

This collaborative effort, driven by the principles of blended finance, is set to unlock unprecedented opportunities for millions of Africans. By expanding critical digital infrastructure, enhancing smartphone accessibility, and broadening access to mobile financial services, Axian Telecom, with the support of its DFI partners, is not just building networks; it is building bridges to economic opportunity, social inclusion, and a more connected, prosperous future for the entire continent. As Africa continues its digital leapfrog, such strategic partnerships will remain indispensable in realizing its full potential.

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photo source: Google

By: Montel Kamau

Serrari Financial Analyst

31st July, 2025