According to the development’s official press release, the investment comprises a 10-year senior loan of €7.2 Mn (USD 8,076,319) in DekelOil Ivory Coast and a €1.5 Mn (USD 1,682,566) equity investment into AIM-listed parent company DekelOil Public for a shareholding of 9.7 percent.
The funds from AgDevCo will be used to fortify DekelOil’s balance sheet, refinancing short and medium-term debt facilities to ultimately free up cash flow for working capital and growth initiatives. The investment will also go into the company’s environmental, social, and governance (ESG) activities.
The near-million funding will specifically bolster the completion of DekelOil’s certification under the Roundtable for Sustainable Palm Oil (RSPO) program, as well as the implementation of a traceability initiative to ensure its fruits remain sources rightly from smallholder growers without affecting natural and critical habitats.
This investment brings AgDevCo’s portfolio to over 40, all of which add up to at least USD 170 Mn. These financial injections span production, processing, distribution companies operating in sub-Saharan Africa that are linked to 480, 000 smallholder farmers to profitable markets.
This investment comes weeks after AgDevCO announced an undisclosed consideration in Africado, an avocado grower and marketer located in Tanzania’s Kilimanjaro region.
It’s as well the impact investors second effort into a new geography since June, when it made its maiden USD 5 Mn investment in Kenya’s Root Capital in a consortium of processors and exporters.
“Responsible commercial agribusiness is key to driving development in the West Africa region,” said Chris Issac, managing director, AgDevCo. “DekelOil has made considerable progress towards building a diversified agriculture operation which is already delivering significant social and community benefits.
We look forward to helping DekelOil continue its expansion, generating opportunities for higher incomes for thousands of smallholder farmers.”
DekelOil Executive Director Lincoln Moore said: “The AgDevCo Loan is a strong endorsement of our strategy to build DekelOil into a leading West African focused agriculture company.
Our collaborative palm oil model benefits local communities and shareholders alike, and we intend to do the same with our large-scale cashew processing project at Tiebissou when production commences in 2020.”