Klabin Growth

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Klabin S.A. (“the company” or “Klabin”), is an integrated Brazilian pulp and paper producer, exporter and recycler in Brazil (https://www.klabin.com.br/en/). The company has 17 industrial units in Brazil, one in Argentina, and three forest management units located in Parana, Santa Catarina and Sao Paulo.In 2013, IFC provided financing for the construction of the Puma I industrial unit located in the municipality of Ortigueira, Parana (https://goo.gl/maps/TdG4Hwoa7GYxUNHX7). Puma I started operations in 2016 and has an approximate production capacity of 1.6 million tons of bleached wood pulp per year. The public disclosure documents for this investment, are available at: https://disclosures.ifc.org/#/projectDetail/ESRS/31903. The proposed IFC investment consists of an A/B/MCPP loan financing package to Klabin, of up to USD390 million. The proposed investment is composed of an up to USD120 million A Loan, up to USD220 million B Loan, and up to USD50 million MCPP. The proceeds will be used to fund the expansion of the Company’s kraftliner capacity.  The project will be divided into two phases, with the construction of each phase projected to last 24 months. The first phase consists of the construction of a fiber line to produce unbleached pulp integrated with a kraftliner paper machine with annual capacity of 450,000 tons. The second phase consists of the construction of a second fiber line integrated with akraftliner paper machine with annual capacity of 470,000 tons.Puma I and II will run as a single production unit, with common management, maintenance and operations and the proposed project therefore will include the expansion of supporting infrastructure and utilities such as waste and wastewater treatment systems.Raw material will originate from FSC-certified existing and new eucalyptus and pine planted forests to be developed and managed by Monte Alegre Forest Unit as well as from third-parties. The Monte Alegre Forest Unit has 361,000 hectares: 200,000 hectares are dedicated to eucalyptus and pine plantations, and 161,000 hectares are protected native vegetation. Any additional land required for the expansion of forest plantations will be acquired only through willing buyer-willing seller transactions and plantations will be implemented in fallow, silviculture or agricultural land.