IDB Invest, DEG and Rabobank Promote Peru’s Agribusiness Through Ecosac
IDB Invest, DEG – the German state development finance institution –and Rabobank have provided $ 93.5 million worth of financing to Ecosac, one of Peru’s main agro-export companies.
The deal consists of two $35 million senior secured loans each from IDB Invest and DEG, and one from Rabobank for $23.5 million.
This deal aims to support Ecosac in its growth strategy, providing funding that allows it to expand its agricultural production with the planting of 250 new hectares of table grapes, improvements in production efficiencies, financing permanent working capital and debt refinancing. Total agricultural production is forecast to grow by 58% between 2021 and 2026.
In addition, the investments, both in the field and in the processing plants, will lead to productive efficiencies that will translate into an increase in the total factor productivity of an average 7% per year between 2021 and 2026. The funds will also allow the increase in exports and the preservation and creation of local employment in rural areas.
Additionally, IDB Invest will provide Ecosac with technical assistance with the main objective of developing a comprehensive action plan to increase water efficiency that increases its resilience to growing water scarcity in the face of climate change. A robust Environmental and Social Action Plan will also be implemented, highlighting measures to improve the efficiency of the use of resources, quantification of greenhouse gases, sustainable soil management and actions to preserve biodiversity, among others. Likewise, IDB Invest and DEG will provide, in a joint effort, advisory services to Ecosac to strengthen its corporate governance practices with the support of the EY consultancy.
This deal is expected to contribute to two of the Sustainable Development Goals (SDGs): Decent work and economic growth (SDG 8) and Partnerships to achieve the goals (SDG 17).
About IDB Invest
IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social, and environmental development in the region. With a portfolio of $13.1 billion in asset management and 385 clients in 25 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.
For almost 60 years, DEG (a member of the KfW Group) has been a trusted partner for private companies active in developing and emerging countries. Our clients obtain from us, according to their needs, adapted financing solutions, support programs and individual advice. In Latin America, DEG has financed infrastructure, agriculture and manufacturing projects and financial institutions and has representative offices in Peru, Mexico and Brazil. We are one of the largest development financing institutions for the private sector with a portfolio of around 8.5 billion euro in more than 80 countries. More information at www.deginvest.de
Rabobank is a bank of Dutch origin, a leader in the food industry, with a presence in more than 40 countries. Being a cooperative, its ambition is to be the main partner of its clients in the development of food chains, offering both sustainable financial solutions as well as sharing expert knowledge, connecting networks and fostering innovation and change, with the purpose of developing together a better world. More information at www.rabobank.com
Ecosac, is a Piurana agroindustrial company belonging to the Costa del Sol group, founded in 2001 in the Caserío de Chapairá, Medio Piura. With a total area of more than 5,800 hectares, of which it has more than 2,500 hectares in production, 3 processing plants and 1 prawn larvae laboratory. Diversification is one of the main strengths of the company with product lines such as (1) Frozen: Fruits, Prawns and Fan Shells; (2) Fresh: Table Grape, Avocado and Tahiti Lime; (3) Preserves: Piquillo Pepper and Red Pepper mainly. This has allowed Ecosac to be one of the main agro-export companies in the country, serving more than 50 countries, generating direct employment for more than 8000 workers simultaneously in the Piura Region. To learn more about Ecosac www.ecosac.com.pe