ETG Edible Oils

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 The proposed investment is for up to $50M USD loan as part of a US$100 million unsecured long-term facility to ETC Group (“ETG” or “the Group”), a leading vertically integrated agricultural supply chain manager in Sub Saharan Africa (“SSA”) with an expanding global presence. This proposed funding will be in support of the Group’s US$200 million capital expenditure and working capital needs for the expansion of three edible oil processing plants in Malawi, Rwanda, and Zambia (“the Project”). Operations in these three countries are through a joint venture between ETG and Parrogate, a longstanding agri-business company in the region. Specifically, the use of proceeds will support an expansion in the crushing and refining capacity of the plants. The Mwembeshi plant, established in 2017 and located on the Mumbwa Road in the Chilanga District, approximately 40 km west of Lusaka, Zambia, will be expanded from 200 tpd to 600 tpd capacity by adding seed offloading and storage, seed cleaning and separation, extraction and meal receiving, and warehouse storage. The Msundwe AVC plant is located off the Lilongwe to Mchinji (M12) road approximately 35 kilometers from Mchinji Roundabout in Lilongwe, Malawi and was established in 2019. Current crushing capacity is 200 tons of soy/day and expansion will result in similar capacities to Zambia operations. The plant in Rwanda started operations in February 2023 with a production capacity of 200 tons per day; this could be expanded to up to 500 tons/day (however not all of that increase in capacity would be attributable to this IFC investment) and future production volumes are dependent on market conditions. The Zambia and Malawi plants crush soy, sourced from within those two countries. The plant in Rwanda sources crude palm oil which it refines into edible oils. As well as expansion in capacity, including refining, capex associated with the proposed investment will be used for modification/upgrades of the existing coal-fired boilers to enable them to use alternative energy uses. ETG is a longstanding IFC client, that is judged to demonstrate satisfactory E&S performance. The last IFC investment can be seen here: https://disclosures.ifc.org/project-detail/ESRS/43692/etg-term-facility