Pearl Dairy

completed

The project consists of an A loan of USD $6.5m by IFC to support Pearl Dairy Farms Limited (“Pearl Dairy” or “the Company”) to establish a modern milk processing plant in Mbarara District of Uganda (the “Project”). The total project cost is USD $13.35m, including working capital. The balance will be financed by USD $3.95m of Sponsor equity and working capital facility of USD $2.9m from a commercial bank. The plant will have a handling capacity of 240,000 liters of milk per day. Its main final product is milk powder and some other products, such as butter, ghee, cheese and cream. In addition, the team is considering a Global Agriculture and Food Security Program component of USD $1m to finance the roll-out of the Company’s extension services program to dairy farmers as well as investments in cooling plants in selected hub districts to facilitate milk collection from smallholder farms. Pearl Dairy is a new venture established by the Midland Group based in Uganda. The Company is jointly owned by the family trusts of the two Sponsors Mr Bhasker Kotecha & Family (50.5%) and Mr Anand Kapoor & Family (49.5%). They are the key shareholders in all Midland Group companies. Construction of the greenfield Project commenced in 2010. The Project is in the final stages of construction phase and its commissioning is expected by the second quarter of 2013. The construction has been financed by Sponsor equity, shareholder loans as well as bank loans from Stanbic Uganda.