Solar Frontier Capital partners d.light to launch US$238m financing vehicle

KENYA – Solar Frontier Capital Limited (SFC), a wholly-owned subsidiary of African Frontier Capital Mauritius LLC (AFC), and d.light design Inc., a leading global innovator of solar powered transformational products for low-income families, have jointly announced the establishment of a US$238 million financing vehicle, Brighter Life Kenya 2 Limited (BLK2).

BLK2 is an off-balance sheet financing vehicle that provides d.light with flexible working capital, enabling the company to provide consumer financing and make its products universally available and affordable for customers, most of whom live below the poverty line and lack access to reliable power.

The facility will finance a range of transformative products that drive quality-of-life improvements, from solar home systems to high-efficiency appliances and smartphones.

“Establishing a large, scalable, multi-currency financing facility will enable millions of families to transform their lives through access to products that were previously out of reach,” d.light CEO Ned Tozun said.

“This facility paves the way for a long-term sustainable business model to bring affordable and transformative technology products to customers who are unbanked and without access to electricity.”

BLK2 is the largest off-balance-sheet facility in the industry thus far, and comes on the heels of d.light celebrating 125 million lives impacted globally.

BLK 2 has been structured to provide d.light with multi-currency financing (up to the equivalent of US$238 million in face value of receivables) over a two-year commitment period, giving the company continued access to sustainable and affordable receivable financing for its Kenyan business with a plan to expand to other African countries in the near future.

“As a long-term equity investor in d.light, Norfund has been impressed with how the company has given millions of people access to clean energy,” Mark Davis, EVP Clean Energy at Norfund commented.

“We are especially pleased that we through this deal are able to provide capital in local currency, to reduce borrowing costs and make it possible for d.light to give increased quality of life through solar energy to even more people.”

The structure is expected to directly impact over 2.8 million lives including the over 1.9 million people with improved access to clean and modern energy who, together, will reduce over 600,000 metric tons of CO2 emissions1.

BLK2 is being partially financed by a US$62 million senior lending facility supported by U. S. International Development Finance Corporation (DFC), Norfund, responsAbility’s managed Funds, and Oikocredit. AFC acts as the subordinated lender as well as the master servicer and back-up servicer under the transaction and, more generally, as sponsor of the structure.

“This facility will impact the lives of millions in Kenya and we are highly confident that it will prove to be a template for even greater impact across the continent. We are thrilled to be able to support d.light’s continuous upward trajectory through the sustainable expansion of its pay-as-you-go activities” James Todd, Head of Renewable Energy at Oikocredit said.

d.light has sold over 25 million products including solar lanterns, solar home systems, TVs, radios and smartphones, impacting the lives of over 125 million people. Our vision is to transform the lives of 1 billion people with sustainable products by 2030.

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