Pearl Dairy Farms Limited
Status: Approved investmentWhy disclosure?
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Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
Founded in 2009 by Bhaskar Kotecha and Anand Kapoor, Pearl Dairy Farms Limited (“Pearl”) is one of the larger dairy processors in East Africa. Pearl sources raw milk from smallholder farmers, cooperatives, and traders in both Uganda and Kenya and processes it into various products: UHT milk, powder milk, flavored milk, yoghurt, butter, ghee. Pearl’s products are sold in multiple countries including Uganda, Kenya, Sudan, Tanzania, Malawi, Zambia, DRC, UAE, India, and Japan.
What is our funding objective?
Pearl will utilize the funds to undertake multiple capital investments in Uganda and Kenya, including the expansion of its milk processing capacity and milk collection center network.
Why do we fund this investment?
With this facility, Pearl will expand its milk sourcing and processing capacity, thereby procuring more milk from smallholder farmers. Through the Dairy Development Program, Pearl wants to increase the number of smallholder farmers it sources milk from - and provides extension services to - from 12,000 to 20,000 over the next 4 years.
What is the Environmental and Social categorization rationale?
Pearl Dairy’s E&S risk category is B+. The risks from the Pearl’s own operations are medium to low, but they are accentuated by the contextual / Human Rights risks in the supply chain and by Pearl’s need to strengthen its E&S team by recruiting additional experienced E&S staff and improve its management systems in line with the IFC PS1 requirements. The following IFC Performance Standards are applicable: PS1 (assessment and management Environmental & Social risks and impacts), PS2 (labour and working conditions), PS3 (Resource Efficiency and Pollution Prevention), PS4 (Community Health Safety and Security), and PS6 (Biodiversity conservation and sustainable management of living natural resources). Pearl is willing to improve its E&S and HR structures, extend its E&S management systems across all its operations, further upgrade its supply chain by shifting it away from suppliers where there is a potential significant risk of conversion to natural/critical habitats, include traceability, and address any potential labour issues. IFC PS5 (Land Acquisition and Involuntary Resettlement) is not applicable since all facilities are owned or leased based on 'willing buyer-willing seller' arrangements and no new land acquisition is planned. PS7 (Indigenous People) is not applicable because indigenous people are not affected by Pearl’s operations, and they will not be affected by the proposed project. PS8 (Cultural Heritage) is not applicable as the proposed project is in an industrial area that is not known for cultural heritage. General World Bank / IFC EHS Guidelines are relevant as well as the Diary Processing Guidelines.
More investments
| Date | Total FMO financing |
|---|---|
| 9/1/2023 | USD 8.75 MLN |
- Website customer/investment
- https://latomilk.com/
- Region
- Africa
- Country
- Uganda
- Sector
- Agribusiness, Food & Water
- Publication date
- 3/7/2023
- Effective date
- 9/1/2023
- Total FMO financing
- USD 8.75 MLN
- Funding
- Building Prospects
-
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - B+