Olam signs loan agreement to improve four food processing plants

Singapore-based agribusiness Olam International has signed a $175m loan agreement for five years in a bid to finance four of its food processing facilities in Nigeria and India.

The agreement has been signed with US-based International Finance Corporation (IFC), a subsidiary of the World Bank Group.

IFC will finance Olam’s permanent working capital and capital expenditure requirements for the four food processing plants of the company.

Olam group chief financial officer Neelamani Muthukumar said: “This latest investment strengthens our partnership with IFC.

“These food processing facilities, located in India and Nigeria, help generate local employment and provide a ready buyer at market prices for farmers in the communities.

“Olam’s focus on inclusive growth, enabling economic prosperity and social and environmental sustainability in developing nations, is a perfect fit with IFC’s mandate.”

In India, the loan will facilitate the agribusiness firm to support the country’s Hemarus sugar mill and spice processing plants, while it will also help develop the Crown Flour Mill and sesame hulling facilities in Nigeria.

These facilities provide employment to the rural residents and support business opportunities for smallholder farmers to sell their crops.

IFC manufacturing agribusiness and services director Alzbeta Klein said: “Through this investment by IFC, Olam will continue to support small-holder farmers in India and Nigeria, who supply commodities to its processing facilities.”

Earlier this year, the company also announced its plans to take-over US-based produce wholesaler Amber Foods, which, through a subsidiary, owns the wheat milling and pasta manufacturing assets of the BUA Group in Nigeria.