Zhende Kenya

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Founded in 1994, Zhende Medical Co.,LTD. (or “Zhende,” http://www.zhende.com/) is a leading medical dressing manufacturer in China with manufacturing centers across China inAnhui, Henan, Jiangsu and Zhejiang provinces. The company is engaged in research and development, production and supply of medical products including infection control, surgical control, traditional wound care, compression therapy and fixation products, stoma care and modern wound dressings. It has been publicly listed on the Shanghai Stock Exchange since 2018.  The proposed investment consists of two senior loans up to US$70 million equivalent  in total to support Zhende to establish a medical supply manufacturing base (including phase I for surgical products and phase II for wound care products) near Nairobi, Kenya (the “Project”). The Project will be implemented in two phases. The cost of phase I is expected to be US$60 million and the cost of phase II is to be finalized after land purchase. The proposed loan will be exclusively used for the project undertaken by the Zhende’s owned subsidiaries, Fullcare (Kenya) Medical Sez Limited and New Beginnings (Kenya) Epz Ltd. (together Zhende Kenya) on the outskirts of Nairobi over two phases. For Phase-I, Zhende Kenya has signed a lease contract for a 10-acre industrial plot in Tatu City, Nairobi (https://www.tatucity.com/). Tatu City is a 5000 acre mixed-use development with about 1000 acres of industrial land which is designated as a special economic zone. The industrial plots provided by Tatu City are fully serviced with transport, water and power infrastructure.  Based on current plans, Zhende expects to start construction on this site from June 2023 and complete it by December 2023. The plant will start production from January 2024 and employ 700+ employees upon launch with 80% being female. For Phase-II, the site is yet to be selected and Zhende is assessing  several options. Once the site is selected, the construction for Phase II is proposed to start by November 2023 and finish by October 2024. The plant is expected to start production in November 2024 and employ 3,000 workers.   The plants will primarily produce Spunbond Meltblown Spunbond (“SMS”) nonwoven fabrics, which are crucial quality medical supplies in Kenya and wider markets.  The main raw material for SMS nonwoven fabic is polypropylene (PP) and manufacturing process includes melting and extrusion of PP. The main raw material for gauze is cotton and process involves spinning and weaving.  Part of the products will be sterilized using Ethylene Oxide gas.