Key Takeaways
- • The Pension Industry Leadership Council (PILC) and UK-funded FSD Africa signed an MoU to support development of a proposed $750 million infrastructure fund backed by Nigerian pension capital and development finance.
- • The platform targets an initial $350 million at its first close, expected in 2027, scaling to $750 million, with roughly $600 million from Nigerian pension funds and at least $150 million from development finance institutions at full size.
- • Nineteen Nigerian pension funds have expressed interest, and an initial pipeline assessment identified 39 projects representing about $20 billion in investment needs.
- • At least 60% of the portfolio is to be allocated to Nigerian projects, with the remainder available for selected regional investments, focusing on equity and quasi-equity capital.
- • FSD Africa will advise on selecting a fund manager through a competitive process, engaging investors and DFIs, building capacity, and supporting regulatory reform.
Summary
Nigeria's Pension Industry Leadership Council (PILC) and FSD Africa, a UK-funded specialist development agency, have signed a memorandum of understanding to support the development of a proposed $750 million infrastructure fund. The fund is intended to combine capital from Nigerian pension funds with development finance to invest in infrastructure in Nigeria and selected markets across the region, according to the original report. The initiative is framed as part of a shared UK-Nigeria effort to deepen capital markets, mobilise domestic investment and channel long-term capital into the real economy.
Under the agreement, FSD Africa will provide expert advice and technical support to establish the vehicle. This includes helping select a fund manager through a competitive process, engaging potential investors and Development Finance Institutions, building capacity, and supporting necessary regulatory reforms. The initiative was developed by Nigerian Pension Fund Administrators with support from the National Pension Commission (PenCom) and FSD Africa, and has drawn interest from 19 Nigerian pension funds.
The platform is targeting an initial capital mobilisation of $350 million by its first close, expected in 2027, before scaling to $750 million. At full size it aims to mobilise approximately $600 million from Nigerian pension funds and at least $150 million from development finance institutions. An initial assessment of Nigeria's infrastructure pipeline identified 39 potentially relevant projects, representing approximately $20 billion in investment needs, particularly in energy, transport and digital connectivity. The vehicle will invest in equity and quasi-equity capital, with at least 60% of its portfolio allocated to Nigerian projects.
The structure envisaged includes a Naira-denominated core investment fund and a separate co-investment vehicle that would let participating pension funds invest alongside the core fund in selected projects. A parallel foreign-currency vehicle may also be established for international investors.
PILC chair and PenCom Director General Omolola Oloworaran said the pension industry holds the largest pool of long-term savings capital in the country and is committed to mobilising it for infrastructure while safeguarding contributors' retirement savings, describing the MoU as "the first step" for the industry. FSD Africa CEO Mark Napier said Africa has significant institutional capital alongside large infrastructure funding deficits, and that the agency aims to help unlock pension capital for priority projects. UK Deputy High Commissioner in Lagos Jonny Baxter said the UK is proud to partner on the investment.
Under the agreement, FSD Africa will provide expert advice and technical support to establish the vehicle. This includes helping select a fund manager through a competitive process, engaging potential investors and Development Finance Institutions, building capacity, and supporting necessary regulatory reforms. The initiative was developed by Nigerian Pension Fund Administrators with support from the National Pension Commission (PenCom) and FSD Africa, and has drawn interest from 19 Nigerian pension funds.
The platform is targeting an initial capital mobilisation of $350 million by its first close, expected in 2027, before scaling to $750 million. At full size it aims to mobilise approximately $600 million from Nigerian pension funds and at least $150 million from development finance institutions. An initial assessment of Nigeria's infrastructure pipeline identified 39 potentially relevant projects, representing approximately $20 billion in investment needs, particularly in energy, transport and digital connectivity. The vehicle will invest in equity and quasi-equity capital, with at least 60% of its portfolio allocated to Nigerian projects.
The structure envisaged includes a Naira-denominated core investment fund and a separate co-investment vehicle that would let participating pension funds invest alongside the core fund in selected projects. A parallel foreign-currency vehicle may also be established for international investors.
PILC chair and PenCom Director General Omolola Oloworaran said the pension industry holds the largest pool of long-term savings capital in the country and is committed to mobilising it for infrastructure while safeguarding contributors' retirement savings, describing the MoU as "the first step" for the industry. FSD Africa CEO Mark Napier said Africa has significant institutional capital alongside large infrastructure funding deficits, and that the agency aims to help unlock pension capital for priority projects. UK Deputy High Commissioner in Lagos Jonny Baxter said the UK is proud to partner on the investment.
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