As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development and has a 50+ year proven track-record of empowering people to employ their skills and improve their quality of life. Each month we give an overview of the transactions we have signed.
The Nigerian company Indorama runs one of the most energy-efficient fertilizer plants in the world. FMO is investing USD 50 mln in an IFC-led syndicated loan, which will fund Indorama’s plans to develop a third nitrogenous urea fertilizer production line and a new shipping terminal at its operations in Port Harcourt, supporting food production and food security across regional and international markets. Building the new production line and terminal will provide jobs to more than 4,000 people during its construction. As part of the project, Indorama will implement a greenhouse gas (GHG) emissions strategy to reduce emissions at its petrochemical complex by 32 percent by 2026, including by significantly reducing gas flaring and other improvements. This strategy aligns with Nigeria’s pledge to eliminate routine gas flaring by 2030 under the World Bank-led Global Gas Flaring Reduction Partnership. The investment received a 78% Green label.
FMO has onboarded a new customer in Uzbekistan, DAVR Bank. The bank operates a network of 7 branches, and with a workforce of over 800 employees, serves more than 146 thousand active customers. DAVR’s business model focuses on MSME and retail segments. FMO provided a debt facility of USD 40 million, disbursed in local currency UZS, or USD. DAVR will use the loan to finance eligible sub-loans for young, female, agri SMEs, and micro-entrepreneurs, which will also need to qualify as green loans. MSMEs play a crucial role in the economy, accounting for 80% of employment and over 30% of the country's exports and imports. By partnering with DAVR Bank, FMO contributes to access to finance for MSMEs in the market while supporting the bank's growth plans in these segments. The investment received a 100% Green and 100% Reducing Inequalities label.
FMO invested in Banco Mundo Mujer (USD 50 mln in local currency), the number one microfinance institution in Colombia (since 2014 operating as a bank). BMM serves ~700,000 clients in most regions of Colombia, predominantly the lower-income population and female microentrepreneurs, earning the investment a 100% Reducing Inequalities-Label. FMO’s financing will allow BMM to further support MSMEs and particularly female microentrepreneurs, not served by the traditional banking sector, as well as expand its Agri Bio-sustainable loan portfolio. This transaction is very relevant for FMO as it is the first deal with a Colombian financial institution, allowing FI-LAC to create a footprint through a highly impactful and well-performing bank such as BMM.
FMO invested in the fourth fund of XSML Capital. The fund is a leading provider of growth capital to promising small and medium-sized enterprises in Central and East Africa, which are in the missing middle segment not addressed by the banking sector and other financial institutions. With African Rivers Fund IV, XSML will expand into Zambia and expects to invest in more than 50 SMEs. XSML raised about USD 100 mln in first close, of which USD 12.5 mln from FMO, under a 100 percent Reducing Inequalities-Label.
