Project detail - Asociacion de Cooperativas Argentinas Cooperativa Limitada

Asociacion de Cooperativas Argentinas Cooperativa Limitada

Status: Approved investment
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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

ACA is an Argentinian second grade cooperative, founded in 1922. The Cooperative brings together 143 first-degree cooperatives through which they reach over 43,000 farmers. ACA is Argentina’s largest grains originator and the largest agricultural inputs supplier. ACA furthermore provides logistics through owned assets and it trades to a limited extend for its own account.

What is our funding objective?

FMO arranges a syndicate of USD 80 mln that will be used for ACA’s pre-export financing purposes. Given the macro-economic conditions and exchange rate restrictions in Argentina, access to finance from foreign financial institutions is virtually closed. FMO’s facility provides ACA with the stable hard currency working capital it needs to carry out its business model of exporting grains and oilseeds through which it supports its member cooperatives.

Why do we fund this investment?

To support ACA's operational activities during the difficult macroeconomic circumstances. ACA is involved from the beginning till the end of the agribusiness chain and the long-term financing will support the client improve its business model and provide more added value towards the farmers. The transaction has a good fit with FMO strategy: ACA, an organization owned by 50,000 farmers, has a deep reach and is active in remote areas of Argentina. Also, the company has a strong drive to improve ESG practices at farmer level and in the value chains in which it is active. Finally, this transaction catalyses an investor that otherwise would not invest in Argentina at this point in time.

What is the Environmental and Social categorization rationale?

The risk category is B+. This is due to occupational health and safety risks in the manufacturing facilities, community health and safety due to transportation of grains and oilseeds, and potential deforestation along the supply chain. The following 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, PS 6 – Biodiversity Conservation and Sustainable Management of Living. PS5 -Land acquisition and involuntary resettlement is not applicable since the company activities do not entail any involuntary displacement (physical or economical) due to land acquisition. PS7 – Indigenous people is not applicable since the company’s activities do not affect directly or indirectly any indigenous population.

Website customer/investment
https://media-exp2.licdn.com/dms/image/c4e0baqgw2rwp6lopea/company-logo_200_200/0/1626956719986?e=16
Region
Latin America & The Caribbean
Country
Argentina
Sector
Agribusiness, Food & Water
Publication date
8/11/2022
Effective date
2/24/2023
Total FMO financing
USD 40.00 MLN
Funding
FMO NV
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+