IFC arranged a €161.25 million financing package for CIMAF, which includes a loan of €92.5 million from IFC's own account, a parallel loan of €33.75 million from Proparco, and a B Loan of €35 million from EAIF.
The financing will help CIMAF expand its existing cement grinding plants in Ghana and Mali and build a new, state-of-the-art integrated cement plant in Senegal. The planned Senegal plant will also produce clinker, a mix of limestone and other minerals used to bind many cement products, reducing the region's reliance on imports.
CIMAF's expansion is expected to create more than 300 direct and 12,000 indirect jobs, including in quarry operations, transport, and other ancillary services. In addition to financing, IFC will also provide advisory services to help OIP increase its resource efficiency, expand its use of renewable energy and alternative fuels, and reduce its overall greenhouse gas emissions.
"We are excited to partner with IFC on an important investment for the group, building our first integrated cement plant outside of Morocco, as well as increasing our grinding capacities in Ghana and Mali," said Anas Sefrioui, Chairman and CEO of OIP. "We look forward to expanding our business in Africa, and doing our part in reducing greenhouse gas emissions, which is why as part of this transaction we are working with IFC to further improve the climate, sustainability and decarbonization aspects of our cement plants."
"We recognise the role the cement industry has to play in achieving the goals of the Paris Agreement," Sefrioui said. "As we have demonstrated in our Morocco operations, we will continue to adopt best practices to reduce our carbon footprint, and replicate these in our African operations."
CIMAF's parent company, OIP, is a major cement supplier across north, west, and central Africa, producing about 12 million tons annually, and is the third largest cement producer in Morocco with two integrated plants that use wind energy to meet the bulk of their electricity demand. CIMAF owns and operates 13 grinding plants in 10 African countries: Burkina Faso, Cameroon, Chad, Cote D'Ivoire, Gabon, Ghana, Guinea Bissau, Guinea, Mali, and Mauritania.
"Supporting local manufacturing will help countries in West Africa reduce their reliance on imports, strengthen local supply chains, and create new job opportunities," said Sérgio Pimenta, IFC's Regional Vice President for Africa. "This investment, backed by advisory support aimed at helping protect the environment, is also timely as the region works to recover from the effects of COVID-19."
"Following our investments in CIMAF in Guinea Conakry and Gabon, Proparco is proud to partner again with CIMAF along with IFC in new West African countries: we wish to support African companies such as CIMAF who invest in climate-friendly technologies and production processes, thereby reducing Africa's reliance on imports," said Denis Sireyjol, Proparco's global head of Manufacturing, Agribusiness and Services.
"We are pleased to partner with CIMAF who continue to adopt best practices in cement production whilst also committing to carbon reduction initiatives. The investments will have significant economic and social impacts in a number of African countries which have growing populations, a great need for good quality housing and growing demand for locally made supplies of key materials for infrastructure," said Martijn Proos, a Director at Ninety One, managers of EAIF.