AEF Carosa Farm (Proprietary) Limited

completed

SUMMARY OF PROJECT INFORMATIONProject Name: South Africa:Carosa FarmRegion: Sub-Saharan AfricaSector: AgribusinessProject Number: 007336Project Approval Date: January 20, 1996Company Name: Carosa Farm (Proprietary) LimitedTechnical Partner and/or Major Shareholders: The project sponsors, Mr. Peter Davidson and his wife, Mrs. Jean Davidson, will be the majority shareholders, owning 41.8% and other shareholders will be institutional investors. It is envisaged that institutional investors will ultimately divest their interest in favour of the project sponsors. The sponsors have retained the full-time services of the farm manager, contracted the services of a foreign technical expert on a quarterly basis and will be assisted by the current owner for the first year..Project Cost and Proposed IFC investment: Project Cost: US$1.648 million IFC Investment: US$0.686 million Loan US$0.522 million Equity US$0.164 millionLocation of project and description of site: The project is located in Tarlton, Gauteng, where soil, irrigation and climate conditions are ideal for high quality rose production.Description of Company and Purpose of the Project: The project involves the purchase, rehabilitation and expansion of the 21 hectare Carosa Farm for R6 million (US$1.64 million). The farm will export most of its rose production through Dutch auctions during the European winter season when production in the northern hemisphere is low and demand for southern hemisphere roses is high. The rehabilitation and expansion programs involve the rationalisation of product variety, renovation and upgrade of infrastructure, and expansion of greenhouses. Upon completion of the rehabilitation and expansion program, production is expected to rise by 48.6% to 5.5 million stems per annum before stabilising at 6.2 million stems. The sponsors have retained the full-time services of a farm manager, contracted the services of a foreign technical expert on a quarterly basis, and will be assisted by the current owner for the first year. The project is consistent with IFC’s strategy to assist previously disadvantaged groups in South Africa.Environmental Category and Issues: This is an environmental review category “B” project. Main environmental and occupational health and safety issues include pesticide handling and application, water supply, provision of protective equipment, integrated pest management, employee training, chemical container disposal and regular medical check-ups for employees handling chemicals. The sponsors have submitted a plan addressing the issues mentioned above. Key elements of this plan include; proper disposal of pesticide containers and provision of protective equipment. The company’s management will ensure that only chemicals that comply with World Bank and government of South Africa environmental guidelines will be used in operations.The Environmental Review Summary (ERS) is expected to be available on or about January 10, 1996 from the Public Information Center.Date SPI sent to PIC: December 20, 1995For additional information contact: Corporate Relations UnitTelephone (202) 473-7711Facsimile (202) 676-0365L:\CAFD1\AEF\SAFRICA\CAROSA.SPIDecember 19, 1995 4:23 PMEnvironmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).