General Information
DEG, a member of KfW Bankengruppe (KfW banking group), has been specialising in long-term project and corporate financing since 1962. As one of Europe’s largest development finance institutions, DEG structures and finances investments by private companies in Africa, Asia, Latin America as well as in Central and Eastern Europe.

DEG invests in profitable projects that contribute to sustainable development in all sectors of the economy, from agriculture to infrastructure, from manufacturing to services and financial institutions. DEG’s aim is to establish and expand private enterprise structures in developing and transition countries, and thus create the basis for sustainable economic growth and a lasting improvement in the living conditions of the local population.

So far DEG has worked together with over 1200 companies. By providing €6.2 billion of finance, DEG has achieved a total investment of €41 billion.

Instruments
DEG offers equity participations and long term loans as well as guarantees and mezzanine finance for investments of private companies, i.e. investments in start-ups or subsidiaries as well as in joint ventures. The financings are tailor-made and designed in such a way that the risk involved is commensurate with the specifics of the respective project.

Equity
Equity participation in the project usually about 5-25%.
Variable arrangements of the risk components.
In certain cases, voting rights and seat on the board of directors of the company.
Clearly defined exit strategies.

Mezzanine Finance
Project-specific arrangement.
Subordination.
Risk-oriented yield.
Conversion rights.

Long-term Loans
Euros or US dollars.
Term usually between four and ten years.
Interest rate fixed or variable; market oriented according to project and country risks.
Collateral security as fixed assets in the country of investment; project-specific arrangement.
DEG share of finance usually up to 35%.

Guarantees
Mobilization of long-term loans or bonds in local currency.
Reduced exchange-rate risk via loan repayment in local currency.
Risk sharing with local bank.