The U.S. International Development Finance Corporation (IDFC) will be one of the main investors in African fiber company Liquid Telecommunication Holdings Ltd., headquartered in Nairobi, Kenya. Liquid Telecom wants to raise $225 million in equity by the end of the year, according to CEO Hardy Pemhiwa. IDFC will be one of the biggest participants in a $90 million tranche in the next few weeks. The fiber company plans a second round later in the year, Bloomberg reported.
Part of the impetus for U.S. involvement is that the geopolitical competition between the U.S. and China is heating up in Africa. With its growing population and vast mineral resources, Africa is attracting international investment. Development institutions such as IDFC are an important way for the U.S. to engage economically on the continent. Importantly, investment in digital infrastructure in Africa will help bridge gaps in countries that lack legacy telecom infrastructure.
Liquid Telecom is working with U.S. tech giants Microsoft (NASDAQ: MSFT) and Alphabet’s Google (NASDAQ: GOOG) on broadband projects in east Africa, according to Pemhiwa. The project with Microsoft aims to deliver affordable broadband through last mile connection to 20 million Africans across Kenya and Zambia, he said.
The fiber infrastructure firm will also work with Google to build out a terrestrial fiber that travels through South Africa, Kenya, Uganda, Rwanda, Zambia, Zimbabwe and the Democratic Republic of Congo. The route will provide connectivity to a number of data centers and an option for traffic reroutes in the event of a subsea cable outage between South Africa and Kenya, Pemhiwa said.
To date, Liquid Telecom says that it has laid over 68,000 miles of fiber across Africa to meet increasing demand for higher-speed internet connectivity and data computing and storage.
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