Washington, D.C., July 26, 2005 –
The International Finance Corporation, the private sector arm of the World Bank Group, has provided $10 million equivalent in equity financing to AgCert International PLC, a company engaged in the production and sale of agriculturally derived greenhouse gas emission reductions, commonly referred to as carbon credits. IFC’s financing will help AgCert roll out emission reduction projects in Brazil and Mexico.
AgCert, headquartered in Ireland, was founded in 2002 to generate and sell reductions in greenhouse gas emissions, which are intended to satisfy the requirements of the Kyoto Protocol and expected to be traded in the international market for carbon credits. Recently established global and European trade systems for such credits include the European Union Emissions Trading Scheme.
AgCert works with swine and dairy farms to modify their animal waste management systems and enable the capture and disposal of methane, thus allowing the creation and sale of carbon credits. This operation will generate a stream of revenues for the company and the farmers.
The project that IFC is financing involves modification of animal waste management systems at about 1,600 sites in Brazil, Mexico, and other countries in Latin America over a two-to-three-year period, at an estimated cost of $150 million. Upon completion of all the planned sites, AgCert is expected to produce about 15 million tons of emission reductions per year.
“This is an innovative transaction with significant development impact potential, not only in reducing greenhouse gas emissions but also in improving the water and air quality at livestock farms. It will provide a source of organic fertilizer and renewable energy for the farmer, thus supplementing his income in more ways than one,” said Jean-Paul Pinard, director of IFC’s Agribusiness Department. He added, “If successful, this business model could be rolled out to farms in other countries, with a positive environmental and development impact.”
Rick Andlinger, Chairman of AgCert, said, “Our relationship with IFC is strategic as we enter new markets. We look forward to continuing to work with IFC as we expand our operations.”
Atul Mehta, IFC’s director for Latin America and the Caribbean, said, “This financing to AgCert fits with IFC’s strategy to support innovative projects in the region and to work with companies that have a commitment to environmental protection and sustainability.”
Antipodean Partners acted as an advisor to AgCert in structuring this transaction. Based in New York City, it is a specialty advisory firm focused on the environmental, financial services, and health care industries.
The mission of IFC (
www.ifc.org
) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.
