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Ethiopia: Proparco is supporting Turaco, a rapidly growing business

Project

Agriculture and agri-food
Signature date
Location
Ethiopia
Financing tool
Loan
Financing amount (Euro)
9998182
Financing details
USD 11m mezzanine loan
Customer
Turaco
Type of customer
Company
Country of headquarters
Mauritius
Project number
PET1009
Environmental and social ranking
B+
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This information is given at the time of signature, without prejudice to any developments in the operation/project.

In Ethiopia, Proparco is supporting a dynamic local player via a loan. Turaco is a young group experiencing very strong growth in the manufacturing of cooking oil, soap and detergents. Proparco is supporting its projects to increase its production capacity and build an extraction plant to extract local oil. Proparco’s investment will also contribute to its institutionalization in terms of governance and Environmental and Social standards.

Client presentation

Turaco is a group of two companies operating in Ethiopia in the consumer goods sector (manufacturing of cooking oil, soap and detergents). The two companies led by Turaco are HCFM, which refines imported crude soybean and sunflower oil into edible and cooking oils, and Gullele/ZAK, which manufactures soap and household detergents and is branching out into the toiletries segment. The strong resilience of the business (locally produced basic necessities) and the reputation of the brands have even allowed the group to maintain a high level of growth during this COVID-19 crisis.     

Project description

The project aims to support the expansion projects of this young group experiencing very strong growth and contribute to its institutionalization in terms of governance and E&S standards, by creating conditions for:

  • A significant increase in the Group’s oil refining capacity and the launch of a range of toiletries products in the soap segment. 
  • The construction of an extraction plant to extract raw oil from locally grown seeds and produce seed cake (residues) that can be sold for export. 

Project impact

Proparco’s investment will support a dynamic local player operating in a frontier country where industries are fragmented and logistics networks are only just developing. It will thereby contribute to increasing the local production capacity for essential goods, which are currently in competition with imported products. As the seed extraction plant benefits from a local supply, it will be possible to both replace imported products and generate revenues in dollars by exporting seed cake (animal feed) on international markets. Our operation will also contribute to institutionalizing this young group, supporting some 500 jobs over the next 5 years and establishing best practices, in particular by implementing an ambitious ESAP. In addition, PROPARCO is playing a real catalytic role in this transaction by mobilizing the participation of Ethos Mezzanine, with which we are the lead institutional investors in the Group.