IFU - Investeringsfonden for Udviklingslande

IFU provides advisory services and risk capital to companies wishing to do business in developing countries and emerging markets

Investments are made on commercial terms in the form of equity and loans. The purpose is to contribute to economic and social development in the investment countries and support the realisation of the UN Sustainable Development Goals.

IFU and IFU managed funds have co-invested in 1,300 companies in 100 countries in Africa, Asia, Latin America and parts of Europe. Committed investments total DKK 209 billion, of which IFU has contributed DKK 23 billion.

Neither aid, nor business grants

IFU is an independent government-owned fund offering advisory services and risk capital to companies wishing to do business in developing countries and emerging markets.

We are not a provider of aid or business grants. We work on a commercial basis, because we believe that business investment is a good way to create lasting economic improvement.

Furthermore, IFU is fund manager of a number of other investment funds, including the Danish SDG Investment Fund.

IFU makes risk capital available in the form of equity, loans or guarantees for project companies in one of the 146 countries eligible for IFU investment. In addition, IFU acts as an adviser during the establishment phase and a project company’s first few years in operation, typically pulling out when the company can operate on its own.

Advisory services are provided by IFU’s investment managers based in Copenhagen or at one of our regional offices in Africa, Asia and Latin America.

IFU and IFU managed funds have invested in 1,300 projects in 100 countries. Investments generally produce positive results and have turned out to be good business for all parties involved; for the host country, the partners and for IFU.

Good business for developing countries

Total investments to date amount to DKK 209bn, of which IFU has contributed DKK 23bn. This has helped to create close to one million jobs in the host countries. In addition, IFU’s presence has resulted in a transfer of knowledge and technology, the employees have received training and education, and economic activity and a basis of income have been created for the host countries.

IFU also helps to highlight a project company’s corporate social responsibilities of ensuring that employees are given proper working conditions and that a project company’s production is socially and environmentally sustainable.

Positive effects for Danish companies

IFU has co-invested with more than 900 Danish companies. In the vast majority of cases, the project companies established in developing countries have been a success, making a positive contribution to the overall performance of the co-investing Danish company.

The Danish companies have gained access to new markets, becoming able to plan and start up international and more efficient production. In many cases, this has also produced higher revenue in Denmark and stronger earnings.

IFU’s mandate was changed as of 31 December 2016, so that IFU is no longer tied to Danish companies or a Danish interest.

Facts about IFU

Here you can read the answers to some of the frequently asked questions about IFU.

What is IFU’s objective?

IFU’s objective is to contribute to economic and social development in the investment countries and support the realisation of the UN Sustainable Development Goals.

What can IFU offer?

IFU provides advisory services and risk capital to companies wishing to do business in developing countries and emerging markets.

What kind of funding can IFU provide?

IFU makes investments on commercial terms by committing equity capital or by providing loans or guarantees. Investments are channelled directly to a project company established in the relevant developing country.

IFU advisory services

IFU advises on how to prepare for, establish and operate project companies in developing countries. IFU offers advice on how to establish new companies, set up joint ventures with local business partners, or acquire already existing companies.

These advisory services are provided in part by IFU representatives serving on the boards of the project companies established in developing countries.

Advisory services are provided by IFU’s investment managers based in Copenhagen or at IFU’s regional offices in China, India, Singapore, Kenya, Ghana, Egypt, Brazil and Ukraine.

How much can IFU invest?

IFU can invest up to DKK 250 million per project company. Generally, IFU has a mandate to take up to a 30% stake in an investment project, but up to 49% in small projects.

Who is eligible for investments by IFU?

Any enterprise wishing to do business in one of the nearly 150 countries eligible for IFU investments.

The requirements are:

The business operation must be deemed to be commercially viable;

Projects must have a development impact in the host country

The host country must be on the list of developing countries eligible for IFU investment. Click here to see the list.

Can IFU provide additional financing?

Through its close relations with international and local financial institutions, IFU may assist in procuring additional funds for a project.

How many investments have IFU made?

Total committed investments by IFU and IFU managed funds amount to DKK 209bn in 1,300 companies, of which IFU has contributed DKK 23bn.

IFU’s annual investment amounts to more than DKK 1bn and involves 20 to 30 companies.

Where does the money come from?

At year-end 2019, total capital under management by IFU was DKK 11.2bn. The capital has been contributed by the Danish State as well as private investors.

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Key figures

Key figures in 2019.

In 2019, IFU and IFU managed funds contracted investments of DKK 1,103m in 25 companies. At the end of 2019, IFU had entered into 1,300 investment agreements in 100 developing countries. As per 31 December 2019, the active portfolio consisted of 196 project companies.

By ultimo 2019, IFU and IFU managed funds had entered into agreements of a total amount of DKK 23bn, of which close to DKK 17bn had been disbursed.

Financial highlights, IFU: