Project detail - AGRICOLA PAMPA BAJA S.A.C.

AGRICOLA PAMPA BAJA S.A.C.

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Who is our client

Agricola Pampa Baja, established in 1999, is a family owned company engaged in the production of fresh fruits & vegetables and also holds dairy operations for the production of milk.

Funding objective

The purpose of the underlying transaction is to finance additional capex, tenor extension of funds used for past capex (including refinancing of the existing USD 15 mln FMO loan) and working capital. The fund will be used for the expansion in the Olmos plantation and crops change in Majes, ensure alignment of its long-term finance with current market conditions, and ensure sufficient availability of working capital during its expansion capex phase.

Why we fund this project

Through the current transaction, FMO will continue a successful relationship supporting a company with a strong track record of growth, commitment to sustainability, and diversified operations, where we can have a positive impact with long term financing and support on ESG and Corporate Governance. This transaction fits with our Agribusiness strategy to grow in Peru in the F&V sector with companies where we can have a strong impact. Despite high liquidity in the Peruvian market, FMO’s transaction is additional as the long tenor is difficult to get from commercial banks.

Environmental and social rationale

Risk category is B+. Potential core E+S risks are: water stress, heavy rainfall due to El Nino and a potential lack of labor availability. The project does not pose direct reputational risks for FMO. Potential opportunity is seen in certifications from an E&S point of especially the SA 8000 certificate for good labor standards. The company currently performs well in Los Olmos. Given the effort in complying with relevant Peruvian law and meeting international standards the Client has demonstrated commitment on E&S requirements and is willing to further improve by understanding and meeting the relevant IFC PS. For the operations of the Company, the following IFC Performance Standards are applicable: PS 1: Assessment and Management of Environmental and Social Risks and Impacts; PS 2: Labor and Working Conditions; PS 3: Resource Efficiency and Pollution Prevention; PS 4: Community Health, Safety, and Security and PS 6: Biodiversity Conservation and Sustainable Management of Living Natural Resources. PS 5 (Land Acquisition and Involuntary Resettlement), PS 7 (Indigenous Peoples) and PS 8 (Cultural Heritage) are not applicable because no people has been resettled neither physically nor economically, no indigenous people are present in the area of influence of the Company and no cultural heritage sites have been detected during the assessment.

More investments

Date Total FMO financing
9/18/2018 USD 24.00 MLN
6/30/2016 USD 15.00 MLN
Website client
http://www.pampabaja.com
Region
Latin America & The Caribbean
Country
Peru
Sector
Agribusiness, Food & Water
Signing date
9/18/2018
Total FMO financing
USD 1.00 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B+