Singapore family office backs African private credit fund - Nanyang Technological University

Singapore-based Tsao Family Office, set up by the family behind maritime conglomerate Tsao Pao Chee Group, has made only its second Africa-focused investment by backing a private credit fund managed by TLG Capital, according to the NTU-SBF Centre for African Studies, which republished the ImpactAlpha report. The family office invested an undisclosed amount in TLG Capital's Growth Impact Fund II, which had attracted US$75m in commitments by April toward a US$200m goal. The family office says it sees potential for both commercial returns and positive social impact, a key part of its strategy, though it remains in an exploratory phase in Africa.

TLG's model works through local African banks that hold viable but underperforming small and medium-sized enterprises on their loan books. Many of these businesses need longer-term US dollar financing to scale but are instead burdened with short-term loans carrying high interest costs. Local banks are typically unable to extend such long-dated US dollar loans, which is the gap TLG targets, pairing capital with active operational support. In some cases, a TLG team member is placed onsite for the first 100 days of a loan. TLG requires a 100% guarantee on the original loan amount from partner banks, which serves as downside protection and as a signal of the bank's confidence in the borrower. In return, banks earn a guarantee fee and may benefit from higher-margin services such as foreign exchange and letters of credit.

A representative transaction involved a US$10mn debt facility extended to the largest aluminium recycler in Nigeria, which had acquired new machinery but lacked financing for reliable power and relied on manual, paper-based systems. TLG financed new generators, placed a chartered accountant within the company, helped digitise inventory and accounting systems, and worked with the company to integrate a solar mini-grid to stabilise energy supply.

Leslie Lim, who leads Tsao's fixed-income portfolio, told ImpactAlpha that TLG's model was unfamiliar and involved some risk, which the firm accepted given its impact mandate. He noted that US dollar-denominated loans remove currency uncertainty, which can otherwise erase gains for foreign investors when African currencies depreciate rapidly. The Tsao Family Office, established more than a decade ago, manages investments across public equities, fixed income, alternatives and real estate. Its only other African investment was in Chancen International's Future of Work fund, which backs education in sub-Saharan Africa. Lim believes the TLG experience could pave the way for further regional investments as the firm deepens its market understanding.