Xiwang Sugar Holdings Company Limited

completed

Xiwang Sugar is a Hong-Kong listed company (stock code 2088.hk) based in Shandong Province and one of the largest corn-processors in China, with 1.5 million tons of processing capacity. It is the fourth largest cornstarch capacity and is China’s number one producer of crystalline glucose with 800,000 tons of capacity. In addition to starch sugars, it also produces corn co-products including corn germ, corn gluten meal and gluten feed. Xiwang Sugar was established in 1986 as a cooperative enterprise in Xiwang Village and started cornstarch processing in 1989, later moving downstream to produce corn-based glucose. Xiwang Sugar was reorganized into a limited liability company in 2001, and after further restructuring was listed on the Main Board of the Hong Kong Stock Exchange in 2005. The Company is launching higher value-added downstream products: crystalline fructose, pharmaceutical-standard glucose and sodium gluconate. The objective is to create better product mix and increase pricing power. The Company is also building additional corn storage capacity to hedge against price increases. The Project consists of an investment in (i) constructing a new 50,000 tpa crystalline fructose plant (the first time the product is made in China) and (ii) upgrading 80,000 tpa of the Company's existing glucose capacity to produce “pharmaceutical grade” glucose. The total Project cost is estimated at $62 million. The proposed IFC investment is a $20-25 million, primarily in the form of long-term debt. IFC also expects the Company to mobilize at least $15-20 million of co-financing.