Nova Lumos Netherlands Holding B.V. raised $90 million from a mix of private equity investors and development banks to deploy pay-as-you-go solar power systems in Nigeria.
It’s the biggest fundraising round to date for the growing off-grid solar market, which seeks to provide cheaper and cleaner alternatives to the kerosene lamp for millions of people living in fuel poverty in Africa, according to Bloomberg New Energy Finance.
About half of Nigerians live without access to the country’s unreliable power grid, according to Elizabeth L. Littlefield, president and chief executive officer of the Overseas Private Investment Corp., which pledged $50 million in debt funding to Lumos.
Lumos allows customers to pay for their solar power through mobile phone credit in partnership with telecommunications company MTN Group Ltd. In the fundraising, another $40 million in equity came from a group led by Pembani Remgro Infrastructure Fund and existing investors VLTCM and ICV, according to the statement.
The fundraising round includes the $35 million that Nova Lumos already announced in September, said Nir Marom, Lumos co-founder, in a phone interview. “We have an unlimited opportunity here. Nigeria is getting a bad reputation and we’re finding it a good place to do business.”
The deal is another example of the growing investor interest in off-grid solar. London’s BBOXX Ltd. raised $20 million in equity in August, while d.light Energy Pvt Ltd. raised $15 million in September, according to BNEF.
“Lumos’s funding round shows pay-as-you-go solar in emerging markets is turning into a for-profit bet rather than an impact-driven experiment,” said Itamar Orlandi, BNEF analyst. ‘If Lumos’s integration with local telcos succeeds, it could lead to far larger engagement of mobile brands in the off-grid energy sector in Africa.”