Blue Sail

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Blue Sail Medical Co., Ltd. (“Blue Sail” or the “company”) which started operations in 2002 in Zibo, Shandong Province, is a leading medical device and healthcare protective glove manufacturer in China (https://www.bluesail.cn/en/index.php/about.html). Listed on the Shenzhen Stock Exchange, the company’s currently installed manufacturing facilities for healthcare protective gloves are located in Zibo and Weifang, Shandong province, China, among which the facilities for nitrile gloves are located in the Qilu Chemical Industry Park and the Linzi Economic Development Zone (EDZ) of Zibo respectively, which are about 10km apart.The company plans to substantially increase its total annual production capacity of nitrile gloves by 20 billion with two proposed greenfield facilities. The expansion will involve construction of two adjacent production facilities located within the Zibo EDZ, with respective annual production capacities of 12.5 billion and 7.5 billion gloves. Since they are adjacent to each other, the two facilities will share raw material storage and pre-treatment facilities, a wastewater treatment plant, and product storage warehouses. Construction of the project will comprise two phases:- Phase I (7.5-billion p.a. facility), with construction already commenced in Q3 2020 and expected to be completed by June 2021; and- Phase II (12.5-billion p.a. facility) expected to reach full completion around 2022.The company’s highly automated production process uses synthetic nitrile latex as the primary raw material for producing nitrile gloves, coated on fully rinsed clean production molds. After a repeated heating and drying process, the gloves are chlorine washed, cooled and demolded. The company’s operations or its supply chain is not linked with Xinjiang in any way.Once operational, the two greenfield project facilities aim to procure electricity and steam (to meet their energy/heating needs) and piped chilled water produced by a coal-fired co-generation power plant (CHP). The CHP - independently owned by a third-party entity - is located within the Zibo EDZ close to project facilities. In a heat exchange process, chilled water from the CHP (delivered to the company facility in closed pipes) will absorb waste heat generated by Blue Sail equipment which will meet its cooling needs while also reducing waste heat loss to the ambient.IFC is proposing a US$150 million secured A Loan to Blue Sail, with IFC’s loan proceeds to be used for supporting construction and operation of the two greenfield facilities (the “project”).