Abyssinia Steel

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The proposed investment is a secured financing package of up to USD20m in A Loans (for capex)to support the capacity expansion, backward integration, decarbonization efforts, and working capital needs of Abyssinia Group of Industries (AGI), one of the leading steel producers in Eastern Africa (Abyssinia or “AGI” or “the Group”) for its operations in Ethiopia, Kenya, and Uganda https://abyssiniagroup.com/ . IFC is also considering mobilizing USD30m in Parallel Loans in local currency in Kenya to refinance some of Abyssinia’s existing short-term facilities for a total financing package of USD50m. Abyssinia Group of Industries was founded in 2003 and is the second-largest steel producer in Kenya, the largest in Ethiopia, and one of the largest overall in East Africa, with a production capacity of 660,000 metric tons per annum (TPA). It has only recently begun operations in Uganda. The Group manufactures a wide range of steel products for the construction industry, such as reinforced bars, steel angles, pipes, tubes, plates, wires, wire mesh (including barbed wire), and nails.  The Project includes (i) expanding capacity in Ethiopia with a block rolling mill, a 25-ton induction melting furnace, a ladle refining furnace, in addition to wire drawing lines and nail machines; (ii) improving operational efficiencies in Uganda; (iii) decarbonization-related investments through an 11MW waste heat recovery (WHR) power plant in Uganda; (iv) decarbonization-related investments by developing a 5MW solar power plant in Kenya; and (v) refinancing of existing working capital facilities in Kenya including through local currency Parallel Loans.