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WASHINGTON, D.C., July 11 -- The International Finance Corporation (IFC) signed an investment agreement in Bangkok today to provide a financing package of US$70 million to the Saha Farms group, one of Thailand's major integrated producers and exporters of poultry products. IFC's investment will contribute to the expansion program of the company, enabling it to improve productivity by constructing a new farm, relocating existing farms from suburban Bangkok to the Lop Buri province, and increasing its network of 2,000 contract farmers. The relocation will assist in improving income distribution and economic opportunities in the region and will help to stem population influx into the capital. IFC will also advise Saha Farms, which is a family-owned enterprise, on listing the company on the Thai stock exchange. IFC's financing package consists of a US$35 million loan for its own account and an equity investment of up to US$10 million equivalent in the company's share capital. In addition, IFC will raise money fro
m international banks and financial institutions through a syndicated loan of up to US$25 million. The estimated cost of the project is US$100 million. The remaining US$30 million will be raised through internal cash generation and an equity investment by the owners. The company's modern processing plants are of a very high standard and comply with internationally accepted regulations on waste, hygiene practices, occupational health, safety, fire prevention, and water treatment. The Saha Farms group was founded in 1969 and was the first Thai company to penetrate the Japanese market, the most important buyer of Thai poultry products. Domestic demand for poultry products has also increased rapidly due to rapid economic growth in Thailand. "With its emphasis on high standards, production efficiencies, and relocation of facilities, the project is likely to have a strong developmental impact," said Mr. Karl Voltaire, Director of IFC's Agribusiness Department. "It also complements Thailand's export-led strategy, wh
ich focuses on the export of high-value added agribusiness products." IFC is the private sector arm of the World Bank Group and is the largest source of equity and loan financing for private sector projects in developing countries.
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