The Africa Agriculture Trade and Investment Fund (AATIF) is a public-private partnership open to investments from institutional investors, professional investors and other well informed investors within the meaning of the Luxembourg SIF law. Targeted investors are donor agencies, governments, international financial institutions and all professional private sector investors.
The Fund is structured to allow investments at three different levels, each offering a unique risk/return profile with dividends being paid following a waterfall principle:
A-Shares are the most senior shares with maturities between 3 and 15 years. They carry a target dividend that is calculated on a 3m Euribor + spread basis. The spread is determined by the Board in accordance with market conditions at the time of an investors’ commitment. Depending on the Fund's profitability, complimentary dividends are possible.
B-Shares with maturities between 5 and 15 years rank junior to A-Shares and provide a higher target dividend calculated on a 3m Euribor + spread basis. The spread is also determined by the Board in accordance with market conditions at the time of an investors’ commitment. Depending on the Fund's profitability, complimentary dividends are possible as well.
C-Shares with usually unlimited maturities bear the highest risk (“First Loss”), offer a comparably lower return and serve as a risk buffer for the more senior share classes with target dividends ranking junior to A and B shareholders. C-Share Investors are typically governments with the goal of leveraging scarce public resources in development finance. By investing in the highest risk tranche at comparably low returns these governments create an innovative and modern departure from the grant based past of development projects in Africa. The investment stimulates the demand for A- and B-Shares, thereby leveraging tax payer money and increasing the socio-economic impact the Fund can have.
D-Shares: In addition to target and complementary dividends, A, B, C shareholders may benefit from capital gains generated by the Fund’s investments. Such capital gains, whether realized or unrealized, will be attributed free of charge to the Funds’ shareholders by the issuance of D-Shares. Such issuance may be triggered, for example, by an appreciation in the value of equity investments. If D-Shares are issued, they protect all other share classes and serve as a first buffer for any net capital losses of the Fund up to their own value. Shareholders are entitled to have their D-Shares redeemed at maturity of the corresponding A, B or C-Shares they own. In this case, however, shareholders will receive the realized portion of their D-Share value only, not the value representing unrealized capital gains.
The Shareholders of the AATIF are represented by a Board of Directors whereby Directors are elected at General Meetings of Shareholders. Duties of the Board of Directors towards the AATIF Shareholders entail among others to refer to the Shareholders of the AATIF for approval of material changes to the Fund’s investment objective and investment policy. Likewise is it the responsibility of the Board of Directors to notify the Fund's Shareholders of the Fund’s course of business, in particular the Fund’s turnover, situation and future expectations on a regular basis.