IFC, a member of the World Bank Group, BID Invest, a member of the Inter-American Development Bank Group, and Rabobank will finance San Miguel, the largest citrus exporter in the southern hemisphere, with US $100 million. This financing will complement San Miguel's capital structure, whose export business is a large employer of direct and indirect labor in each community where it operates. In Tucuman, Argentina, it employs more than 4,500 people each season.
IFC and BID Invest will each contribute US $27.5 million and Rabobank US $45 million. IFC and BID Invest will also advise San Miguel on the implementation of good environmental practices in key areas, such as wastewater treatment.
"We welcome the IFC, IDB Invest, and Rabobank as partners in our effort to strengthen our position as a multinational Argentine company as we expand into new markets and continue to drive our sustainable agribusiness model," said Romain Corneille, the CEO of San Miguel.
The financing package offers a term of up to 9 years, which is longer than what is currently available in the market. This is essential for this industry, as citrus trees take at least five years to produce quality fruit for export. The financing will contribute to San Miguel's $132.5 million-dollar investment plan to grow its business model in a sustainable and customer-oriented way, as a world leader in citrus production and in the processing of value-added citrus products. It will help San Miguel expand its operations in Argentina, Uruguay, Peru, and South Africa and grow its production volumes of lemon, orange, mandarin, table grape, and avocado.
"We are proud to continue our work with San Miguel to expand its operations. The company is an example of how Argentine companies can compete successfully in the world and create jobs where they are most needed, "said David Tinel, IFC Regional Manager for the Southern Cone. "IFC is committed to supporting sustainable agribusiness in Argentina and Uruguay, and strengthening export sectors to contribute to the growth and strengthening of these countries economies."
"The financing offered by BID Invest to San Miguel seeks to support one of the most important fruit exporters in Latin America and the Caribbean. This will improve the export capabilities of three destinations: Argentina, Uruguay, and Peru. It will also generate employment in the rural areas through operations implemented in a sustainable manner," said Aitor Ezcurra, the Head of the Corporate Division of BID Invest.
"Rabobank has provided ongoing support to agribusiness companies in Argentina for 25 years and it continues to strengthen its commitment to the country, the sector, and its customers through different transactions, such as this $100 million-dollar medium-term financing for San Miguel," said Rafael Bonasso, a Representative of Rabobank. "We hope to continue providing support to our customers in the coming years," said Rafael.
Citrus fruits are among the most popular fruits in the world. In the last five years, global demand for lemon juice and oil has been growing at an annual rate of more than three percent. The lemon industry in Tucuman employs 40,000 workers and produces 1.3 million tons of lemons per year. The industry exports lemons and related products to Europe, the United States, Canada, Russia, Hong Kong, and the Middle East.
In August of 2017, San Miguel incorporated grape and avocado for the first time through the purchase of Agricola Hoja Redonda SA, a Peruvian company that produces up to 28,000 tons of mandarin, table grapes, and avocados each year.