São Paulo, Brazil, February 25, 2015 -
IFC, a member of the World Bank Group, is investing $80 million in Usina Delta, a sugarcane and ethanol producer in Minas Gerais, Brazil, to support its agricultural and industrial investment program and strengthen its sustainability approach.
Delta’s investment program includes the expansion of its co-generation electricity operations, which will increase its generating capacity by approximately 250,000 MWh of electricity annually through renewable, bagasse-fueled co-generation. Delta has been generating a surplus of about 180,000 MWh per year, which it supplies to the electricity grid and neighbors. As a result of this project, Delta will generate an annual surplus of about 430,000 MWh, enough to power a city of 235,000 people.
Brazil is the world’s largest sugar cane producer and exporter, and the second largest ethanol producer. Sugar and ethanol production are crucial for economic development and job creation in Brazil, employing 1.1 million people and accounting for 11 percent of the country’s exports.
IFC’s long-term financing of 7 to 9 years includes a $40 million loan and a $40 million syndicated loan with the participation of Rabobank and the IFC Managed Co-Lending Portfolio Program, a new syndications platform that offers institutional investors an opportunity to participate in IFC’s future senior loan portfolio.
According to Mr. Robert Lyra, Delta´s shareholder, “Delta is pleased to partner with IFC, not only for the loan that will result in a better capital structure for the company, but also for the support provided by IFC on strengthening Delta´s environmental, health and social policies, and corporate governance standards”.
“This project is consistent with IFC’s agribusiness strategy in Brazil of supporting food security and rural incomes by improving productivity in agriculture, promoting inclusive growth, and strengthening environmental and social practices. Usina Delta is a key player in the Cerrado region in Minas Gerais, where the company plays an important role in social and economic development,” said Luiz Daniel de Campos, Principal Investment Officer, Agribusiness Department, IFC Brazil.
In addition to financing, IFC will help strengthen Usina Delta’s environmental, social and corporate governance standards, to enhance the company’s ability to identify business risks and opportunities.
IFC’s global investment in the agricultural sector supported the employment of 421,500 people, including 124,000 women, and reached 3.1 million farmers worldwide in 2013. IFC’s total agribusiness investment in fiscal year 2014 was $4 billion.
About IFC
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. Working with private enterprises in more than 100 countries, we use our capital, expertise, and influence to help eliminate extreme poverty and promote shared prosperity. In FY13, our investments climbed to an all-time high of nearly $25 billion, leveraging the power of the private sector to create jobs and tackle the world’s most pressing development challenges. For more information, visit
www.ifc.org
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