Project detail - Ulusoy Un Sanayi ve Ticaret AS

Who is our customer

Ulusoy Un Sanayi ve Ticaret A.Ş. (“Ulusoy”) is one of the largest wheat-flour milling companies in Turkey, milling, and selling flour domestically and for export to the Middle East, Africa, and Asia. The company purchases wheat in Turkey and from abroad in the Black Sea region. Ulusoy then processes it into flour in its milling facilities in the cities of Samsun and Çorlu/Tekirdağ, as well as in its subsidiary, Söke’s mills in Söke/Aydın and Ankara. The company is also engaged in the trading of wheat and other grains in domestic and international markets, and agri-commodity storage/warehousing in Turkey. Ulusoy has been a client of FMO since 2018, when FMO provided a long-term CAPEX facility of USD 18 mln to the Company for financing the construction of its new state-of-the-art flour mill in Samsun. Later in 2021, FMO provided an additional long-term acquisition loan of USD 25 mln to the Company for financing the acquisition of Söke, a local flour producer with a recognisable consumer brand, and the working capital requirements of the acquired company.

What is our funding objective?

New funding by FMO will support the growth investments of Ulusoy, consisting of CAPEX investments to modernize its recently acquired mill to increase its milling capacity in the Antakya Province of Turkey, which was impacted by the earthquakes in February 2023. FMO intends to provide a long-term facility of USD 12 mln to finance the CAPEX and working capital requirements of this mill to increase in employment in this region.

Why do we fund this investment?

FMO also supports an important agribusiness player that has linkages in the upstream agricultural sector in Turkey. The transaction could contribute to SDG 2 - zero hunger (through capacity expansion and increasing volumes of flour products to the Middle East and Africa, i.e., contribution to food security), SDG 8 - decent work & economic growth (contribution to the employment in a rural and earthquake affected region of Turkey and generation of hard currency via exports), and SDG 13 - climate action (in view of Ulusoy’s efforts in transitioning to renewable energy usage in its operations).

What is the Environmental and Social categorization rationale?

The transaction has been classified as E&S risk category “B” (medium to low). E&S operational risks and impacts are mostly site-specific that must be managed consistently with the following IFC Performance Standards: PS1: Assessment and Management of Environmental and Social Risks and Impacts, PS2: Labor and working conditions, PS3: Resource Efficiency and Pollution Prevention, and PS4: Community Health, Safety and Security. Standards PS5 (Land Acquisition and Involuntary Resettlement), PS6 (Biodiversity Conservation and Sustainable Management of Living Natural Resources), PS7 (Indigenous Peoples), and PS8 (Cultural Heritage) are considered not applicable. The project is in a dedicated industrial area with necessary provisions for environmental impact elimination. The company has ISO certifications that serve as the backbone of its environmental and social management system. The company sources from highly mechanized producers of wheat, soy, and corn from Eastern Europe and Turkey.

More investments

Date	Total FMO financing
4/22/2024	EUR 0.02 MLN
12/13/2021	USD 15.00 MLN
12/13/2021	USD 10.00 MLN
9/10/2018	USD 18.00 MLN