SPEAR Capital, a Scandinavian-backed Sub-Saharan Africa focused private equity investment company, has acquired a 27% stake in Dendairy, Zimbabwe’s second largest dairy producer, in a combined debt and equity transaction valued at $6m.

Christian Victor Bernau, SPEAR Capital partner, said: “Dendairy’s unique footprint in Zimbabwe, is well positioned for growth in Zimbabwe and we are targeting export markets within the region. There is growing demand for dairy products and the improvement in the political and economic environment are reasons that will provide numerous scalable growth opportunities for Dendairy.”

Dendairy started from humble beginnings in 2004 when two dairy farmers setup a small Maas processing plant in Kwekwe.

Dendairy has invested heavily in its factory and grown its raw milk supply since its establishment in 2004, the company has continued to experience exceptional market penetration and growth within the Zimbabwean market, and has recently expanded its footprint to include Mozambique and Zambia.

Dendairy currently produces Maas (fermented milk), UHT milk, UHT flavored milk, yogurts, ice cream, and fruit juices.

Bernau said that SPEAR Capital’s stake could rise to 30% if built in performance measures are met, while this investment marks SPEAR Capital’s second investment in the Zimbabwe market in the last 12 months.

“As a firm that invests in exceptional managerial talent in growth sector industries, Dendairy optimizes the types of opportunities SPEAR Capital strives to unearth,” he said.

SPEAR Capital was established by Christian Victor Bernau and Martin Soderberg in 2012.

The firm invests in businesses that are positioned to benefit from the continued economic growth in Sub-Saharan African countries.

SPEAR Capital explores possibilities within the fast moving consumer goods (FMCG), manufacturing & processing, financial services and telecom/media/technology.

SPEAR Capital makes investments on behalf of SPEAR Africa Holdings, a Mauritian registered investment company.