Project detail - Ecom Agroindustrial Corp. Limited

Who is our prospective customer?

ECOM Agroindustrial Corp. Ltd is a family-owned, global leader in the integrated physical supply chain, operating across 40 producing countries. The company holds top market positions, ranking third in coffee, fourth in cocoa, and third in cotton based on global trading volumes. With a commercial presence worldwide, ECOM sources from about 20 origins and serves over 85 sales destinations across the globe. Headquartered in Switzerland, ECOM brings 175 years of expertise, a strong reputation, and a deep commitment to sustainability.

What is our funding objective?

The funding aims to support Ecom’s operations and investments throughout the supply chain in origin markets through financing of working capital needs, strengthen both its capital and liquidity positions in the light of continued high cocoa and coffee prices. The proposed financing consists of two transactions: 1) syndicated long-term loan for working capital of up to 215 mln. FMO is the mandated lead arranger (on a best-efforts basis), providing up to USD 50 mln (FMO-A), including FIM funds participants, and up to USD 165 mln from other European DFIs. FIM funds are serviced by FMO Investment Management, focus on emerging markets, and aim for financial returns and development impact. And 2) a USD 30mln bilateral subordinated loan to be financed from FMO-A. ECOM’s activities are expected to increase engagement with farmers, cooperatives, and aggregators farmers in the countries of origin.

Why do we want to fund this investment?

FMO aims to fund this investment because ECOM plays a fundamental role in transforming rural economies by empowering smallholder farmers and promoting sustainable practices. With a strong local presence across key producing regions, ECOM partners with over 500,000 smallholder farmers, fostering inclusive supply chains that create social and economic impact. Over the past decade, ECOM’s growth has been backed by its inclusive model and commitment to sustainability (SDG13) and inclusivity (SDG10), values that align with FMO’s mission. Additionally, FMO involvement has also helped Ecom shape their impact ambitions and corporate governance in the past 13 years. By continuing this partnership, FMO will help ECOM further advance and continue its work with inclusive supply chains and impact in producing communities.

What is the Environmental and Social categorization rationale?

This concerns an E&S A categorized investment. While all IFC Performance Standards (PS) are applicable to this investment, FMO’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following PSs: PS 1 – Assessment and Management of Environmental and Social Risks and Impacts, PS 2 - Labor and Working Conditions, PS 3 - Resource Efficiency and Pollution Prevention, PS 4 – Community Health, Safety and Security, PS 6 – Biodiversity Conservation and Sustainable Management of Living Natural Resources. FMO will periodically review the project’s ongoing compliance with the Performance Standards. Issues related to PS 5: Land Acquisition and Involuntary Resettlement, PS7: Indigenous Peoples (IPs) and PS8: Cultural Heritage, are not expected with this investment for the following reasons: no land will be required to be obtained (processing operations are already established); IPs are not impacted by the company’s operations nor are matters of cultural heritage as processing plants are located in existing industrial areas and farmers supplying to the company have existing properties/fields and any development would be limited to replanting with higher producing coffee or cocoa plants. In addition, ECOM is further refining its transparency and traceability in its supply chains for coffee and cocoa to ensure compliance with the EUDR.

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