ARM-Harith Infrastructure Investment Limited and FSD Africa Investments (FSDAi) have announced a joint GBP 10 million commitment aimed at unlocking local pension fund capital for infrastructure development in Nigeria.
Rachel Moré-Oshodi, CEO of ARM-Harith, said: “For too long, domestic pension funds have remained on the sidelines of infrastructure equity due to liquidity constraints and heightened perception of risk. We are proud to have collaborated with FSDAi to design a pioneering solution that reduces risk for pension funds while delivering both early liquidity and long-term capital growth.”
The investment will go into the ARM-Harith Climate and Transition Infrastructure Fund (ACT Fund), a vehicle focused on supporting climate-resilient infrastructure projects. FSDAi, a UK-backed development finance investor, is providing this commitment to help mobilise domestic institutional capital and address barriers to local investment in infrastructure equity.
A key feature of the partnership is the design of an innovative financing structure that enables Nigerian pension funds to invest in infrastructure while accessing early liquidity. The structure offers predictable interim distributions during the initial investment phases. This tackles a challenge that has previously limited pension fund involvement in infrastructure equity—lack of early returns.
In addition, 75% of FSDAi’s GBP 10 million commitment will be provided in local currency. This is the first time a structure of this kind is being used in Nigeria and is aimed at reducing exposure to foreign exchange risks for local investors.
The structure is expected to unlock an estimated GBP 31 million in further commitments from Nigerian pension funds—almost five times what was mobilised for ARM-Harith’s first fund.
Anne-Marie Chidzero, FSDAi’s Chief Investment Officer, said: “We are thrilled to collaborate with ARM-Harith to showcase how risk-bearing capital from a market-building investor like FSDAi can be strategically structured to unlock domestic institutional capital. This approach strengthens Africa’s financial markets and facilitates capital allocation towards sustainable, green economic growth across the continent.”
The British Deputy High Commissioner in Lagos, Mr Jonny Baxter, noted: “The UK government, through its bilateral and investment vehicles, is committed to continue to support the country’s financial sector—developing domestic capital markets as a means of financing priority sectors and driving economic development.”
