Project Nautilus (Commercial Cold Holdings)Status: Approved investment
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Who is our customer
Commercial Cold Holdings Limited (“CCH”, or the “Platform”) is established as a South-African cold storage platform with a pan-African expansion strategy. CCH is on a path of acquiring and consolidating existing and greenfield businesses within the Temperature Controlled Logistics (“TCL”) market with a focus on storage. Its anchor investments are based in South-Africa and Namibia. CCH will pursue expansion beyond South Africa and Namibia into other countries across East, West and North Africa.
What is our funding objective?
FMO is providing equity financing for a co-investment of up-to USD 20mln alongside the AIIF4 and IDEAS funds managed by AIIM to acquire a stake with significant influence. Initially CCH will acquire and integrate businesses in South-Africa, potentially followed by acquisitions in the rest of Africa. A key positive impact will be the reduction of the carbon footprint, to be achieved by increasing the amount of renewable energy used to power the facilities and in some instances the use of CO2 as a refrigerant.
Why do we fund this investment?
This opportunity fits well with FMO’s strategy of pursuing impactful co-investments in its core focus sectors with partner fund managers. The Platform will address a specific gap in the food supply chain by increasing cold storage capacity. Having an uninterrupted cold chain is vital to reduce food loss and waste, indirectly contributing to SDG 2 (Zero hunger). Through the provision of meaningful work during construction and operations, the Platform will also improve livelihoods for those employed and contribute to SDG 8 (Decent work and economic growth).
What is the Environmental and Social categorization rationale?
This concerns an E&S category B investment, as CCH is expected to cause limited adverse environmental or social risks and/or impacts. They are expected to be few in number, site-specific, largely reversible, and readily addressed through mitigation measures. The following IFC Performance Standards are triggered: PS1: Assessment and Management of Environmental and Social Risks and Impacts, PS2: Labor and Working Conditions, PS3: Resource Efficiency and Pollution Prevention and PS4: Community Health, Safety and Security. PS5: Land Acquisition and Involuntary Resettlement, PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources, PS7 (Indigenous Peoples) and PS8 (Cultural Heritage) are not applicable. Our investment will include active engagement and support on environmental and social aspects, including appropriate permitting of each of the sites. Actions will be formalized in an environmental and social action plan, the implementation of which will be monitored throughout the lifecycle of this investment.
- South Africa
- Agribusiness, Food & Water
- Publication date
- Effective date
- Total FMO financing
- ZAR 277.50 MLN
- 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)