IFC. Sugal Financing
1. Deal Description
IFC is investing USD$50 million in Sugal Chile Limitada, a Chilean subsidiary of the Sugal Group, the world's second largest producer and exporter of tomato paste, to support farmers, while also reducing greenhouse-gas emissions and boosting energy and water efficiency in Chile. The aim of the IFC investment is to create market competitiveness and contribute to the country's climate goals.
IFC's loan will help Sugal Chile expand its operations, which include starting a new tomato paste production line, maintaining other plant, adopting energy efficiency measures by replacing a coal boiler by a more efficient one operated with liquified petroleum gas, and boosting productivity through process reengineering. The funding will also allow the company to reach more farmers, helping them prepare land, procure fertilizers and seeds, and install drip irrigation systems.
The financing package comprises an "A" loan of up to USD$25 million and up to USD$25 million from IFC's Managed Co-Lending Portfolio Program, an innovative syndications platform that allows institutional partners to participate in IFC's loan portfolio. The project is under IFC's Global Food Security Platform, which aims to support the sustainable production of essential staples—for example, processed tomatoes—in developing countries, especially with soaring food prices.
2. Counsel list
• Local counsel to IFC: Guerrero Olivos
o Partners; Miguel Coddou and Benjamín Pérez
• International counsel to IFC: Herbert Smith Freehills LLP
• International counsel to Sugal: Viera de Almeida
3. Date of closing
16/08/2023
4. Deal Value
USD50 million
5. Jurisdictions Involved
Chile, England and Portugal