news - Monthly Transaction Overview - February 2023


Monthly Transaction Overview - February 2023

March 7, 2023

As a leading impact investor, FMO supports sustainable private sector growth in developing countries and emerging markets by investing in ambitious projects and entrepreneurs. FMO believes that a strong private sector leads to economic and social development and has a 50-year proven track record of empowering people to employ their skills and improve their quality of life. Recently, our focus has been on business continuity in the wake of the COVID-19 pandemic. It is precisely now, during these times of crisis, that it is important to continue to invest in developing economies that are already or expected to be hit hard by the pandemic. While local governments are working hard to minimize the impact on their people and economies, we are needed now more than ever. Hence, we continue to empower entrepreneurs in developing economies to build a better world and boost resilience to withstand the pandemic.

Financial Institutions

NMB Bank plc
Universal bank in Tanzania

FMO contracted a USD 11 mln (TZS equivalent) NASIRA guarantee facility for NMB Bank plc, our longstanding client in Tanzania (LDC market). NMB Bank is the top bank in Tanzania actively increasing its exposure to MSMEs. FMO’s NASIRA guarantee will focus exclusively on their MSME loan portfolio with a particular focus on women-owned, youth-owned and agriculture businesses. By sharing in potential credit losses, the guarantee will support the bank to increase its lending activities towards these underserved segments, which are typically perceived as high risk. FMO will also be supporting NMB with technical assistance to ensure they have the right processes, products and trainings in place to reach these segments and deliver their MSME strategy.

Commercial International Bank - CIB 
Bank in Egypt

FMO signed a credit guarantee agreement of USD 50 mln with Commercial International Bank (CIB), Egypt’s leading private sector bank, to cover loans granted to the Bank’s micro, small and medium enterprises (MSMEs), including underserved segments such as women, youth and migrant borrowers. The agreement comprises two components: the NASIRA risk-sharing facility backed by FMO, the European Union and the Dutch government (through the MASSIF fund), and a technical assistance program provided by the Frankfurt School of Finance and Management.

Agribusiness, Food and Water

Asociación de Cooperativas Argentinas
Cooperatives Association in Argentina

FMO signed a USD 80 mln PXF syndicated loan with Asociación de Cooperativas Argentinas (“ACA”). This is a syndicated transaction from which FMO is committing USD 40 mln, Findev Canada USD 20 mln, and Rabobank (also acting as security agent and co-arranger) USD 20 mln. ACA is an Argentinian cooperative of cooperatives. The Cooperative brings together 143 first-degree cooperatives through which they reach over 50,000 farmers. ACA is Argentina’s largest grains originator and the largest agricultural inputs supplier. This syndicated facility provides ACA with the stable working capital it needs to carry out its business model of exporting grains and oilseeds through which it supports its member cooperatives.

Latin American Agriculture Development Corporation 
Latin America-focused Bank

FMO activated a USD 10mln Green tranche with Latin American Agriculture Development Corporation (LAAD). LAAD is a pan-Latin American bank financing export-oriented SME’s in the agricultural sector, many active in primary agriculture. LAAD is active in 27 countries across Latin America and the Caribbean. LAAD supports companies that are highly impactful through their job creation in rural areas. These companies play a vital role in global supply chains and support the sourcing efforts of our global trader clients. This specific green tranche aims to support LAAD’s investments in companies falling within their green strategy.  

Private Equity

MFI-NBFC in India 

FMO invested equity of USD 11 mln (equivalent in INR) in Arohan Financial Services Ltd. Arohan is a microfinance institution that currently serves around 2 million low-income female borrowers - mostly in economically less developed regions of Eastern and Northern India, contributing to both SDG 10 (Reduced inequalities) and SDG 5 (Gender equality). The company currently has a loan portfolio of ~USD 500 mln and is promoted by the Aavishkaar group – with whom FMO has a long-standing relationship. The capital infused is expected to catalyse post-COVID growth of Arohan, in the backdrop of an anticipated macro credit expansion in India. Arohan plans to complement its branch network with increased technology enabled delivery.

Partech Africa Fund II
Global technology investment firm in Africa

FMO committed EUR 25 mln in the Partech Africa Fund II, a global technology investment firm. Partech Africa Fund II (PAF 2) will double-down on its successful strategy to identify and support the next generation of leaders in Africa. The Fund will provide seed to growth funding to support entrepreneurs who use technology and excellent operations to boost opportunities in various sectors. The completion of this transaction is a great example of our graduation model, as PAF2 marks the first African VC Fund investment that ‘graduates’ into our model.

Pharmaceutical enterprise in Morocco  

FMO has signed a EUR 15mln co-investment in Laprophan alongside Mediterrania Capital IV (“MC IV”), together with DEG and Proparco. Laprophan is active in the manufacturing, distribution, import, and export of pharmaceutical products in Morocco, and is supported by a solid reputation and network. FMO’s support will go to improving environmental and social (E&S) practices. Overall, the transaction contributes to sustainable economic growth and supports the continued availability of locally-produced reasonably priced pharmaceuticals for the local population.


Renewable energy project in Argentina

FMO committed to support climate action and mitigation, by providing a syndicated loan of USD 85 mm (USD 45mm from FMO and USD 40 from FinDev) financing to Genneia S.A., our longstanding partner in Argentina. The funds will finance the construction of two greenfield renewable energy projects: a 60 MW photovoltaic solar plant, and a 140 MW wind farm. Genneia is one of Argentina’s leaders in renewable energy, holding roughly a quarter of the country’s installed renewable energy capacity and having a gross installed capacity of approximately 1,230 MW (866 MW from wind and solar plants). As true pioneers in the country, the company has also built the largest wind farms in Argentina. The long-term 10-year facility is extremely scarce in Argentina and will allow FMO to contribute to long-term climate action in line with our commitment for a net-zero portfolio by 2050.

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