MERCAPITAL DE NICARAGUA S.A.
Status: Approved investmentWhy disclosure?
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Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
Mercapital de Nicaragua S.A. (Mercapital) is the financial arm of Mercon Coffee Group (MCG) in Nicaragua. MCG is one of the world’s leading coffee merchants. It has sourcing operations in Central America, Brazil and Vietnam and a significant share in sustainable and quality coffees. Mercon is involved in all aspects of the coffee supply chain from primary production, production and distribution of seedlings, sourcing and processing of coffee from third parties to the delivery and export of green coffee. Mercon has developed into a supply chain manager with upstream operations and producer engagement in origin countries and strong relationships with premium coffee buyers. The coffees that Mercon sources are mostly certified (Utz, 4C, RfA, C.A.F.E. Practices) and deliveries are based on long-term relationships between Mercon and the producers.
What is our funding objective?
FMO will provide a sub-ordinated debt facility up to USD 5 million. The funds will be utilized to build a portfolio with long- and short-term loans to Arabica and Robusta coffee farmers for purposes such as farm renovation & new plantings, to cover labour costs and farm inputs and will strengthen the capital position of Mercapital.
Why do we fund this investment?
Mercapital supports MCG’s coffee operations in Nicaragua hand by hand with Comercial Internacional Exportadora S.A. (CISA), the group’s main operating company in the country. Mercapital provides long and short-term financing to over 3,000 coffee producers. Support from CISA and Mercapital enables producers to achieve their long-term farm objectives of increased production & yields, improved climate resilience and stabilized earnings from the farms in impoverished regions of Nicaragua.
What is the Environmental and Social categorization rationale?
The focus will be on the Social aspects, namely implementation of the Client Protection Principles.
More investments
| Date | Total FMO financing |
|---|---|
| 1/14/2020 | EUR 0.02 MLN |
| 12/17/2018 | USD 5.00 MLN |
- Website customer/investment
- http://www.merconcoffeegroup.com/about-us/
- Region
- Latin America & The Caribbean
- Country
- Nicaragua
- Sector
- Financial Institutions
- Publication date
- 9/25/2019
- Effective date
- 11/1/2019
- Total FMO financing
- USD 5.00 MLN
- Funding
- MASSIF
-
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) - C