UGANDA- Pearl Dairy, Uganda’s leading dairy processing company, is seeking support from the International Finance Corporation (IFC) to enable it acquire a dairy plant in Kenya as well as boost its own to boost production of powder milk.

According to a disclosure from the investment arm of World Bank, the maker of Lato Milk has asked for a total of US$35m credit facility to support its ambitious expansion plans as well as enable it to refinance a commercial loan.

From the disclosure, US$ 21 million will be allocated to capital expenditure program which “including the upgrade and capacity increase of the powder milk plant in Uganda, and the acquisition of a packing plant in Kenya.”

At least US$14m will go to “refinancing of existing Standard Chartered Bank loan in Uganda”, according to IFC.

IFC, which is expected to decide on the loan request in May 2023, said the credit facility would “enable local value addition by a dairy company that is facing significant risks and shocks related to export bans, COVID- 19 and drought.

The news comes barely a fortnight after Kenya’s Trade and Investment Cabinet Secretary Moses Kuria said Lato had signed a deal with the State-owned financier Kenya Development Corporation (KDC) to invest jointly in dairy ventures.

Mr Kuria said Lato would invest in Kenyan milk factories that are currently struggling in a bid to revive them in what will see the Ugandan firm enhance its ability to compete with several established dairy companies such as Brookside and state-owned New Kenya Cooperative Creameries.

IFC expects Pearl Diary’s expansion project to increase dairy productivity and smallholder farmers’ access to the raw milk market in Uganda and Kenya.

“The Project will also contribute to food security by increasing the volume of dairy products sold to consumers,” said IFC.

“At the market level, the Project will help to strengthen the resilience of the dairy sector in the two countries by building capacity in dairy supply chain to withstand macro shocks and stresses related to droughts.”

Pearly Dairy already has a presence in Kenya where it is registered under the name “Musty Distribution” but doing business has not been a walk in the park.

Kenya has previously suspended milk imports from Uganda, affecting Pearl Diary’s revenues and increasing its costs of production.

However, Kenya’s President William Ruto recently lifted the ban on Ugandan agricultural produce such as milk, eggs and chicken, giving new hope to Pearl which was forced to lay part of its workforce in 2021 due to the export bans.

IFC support is the second of its kind to the Uganda-based dairy. In 2015, IFC loaned  $6.5m to Pearl Diary to establish a modern milk processing plant in Mbarara District

UGANDA- Pearl Dairy, Uganda’s leading dairy processing company, is seeking support from the International Finance Corporation (IFC) to enable it acquire a dairy plant in Kenya as well as boost its own to boost production of powder milk.

According to a disclosure from the investment arm of World Bank, the maker of Lato Milk has asked for a total of US$35m credit facility to support its ambitious expansion plans as well as enable it to refinance a commercial loan.

From the disclosure, US$ 21 million will be allocated to capital expenditure program which “including the upgrade and capacity increase of the powder milk plant in Uganda, and the acquisition of a packing plant in Kenya.”

At least US$14m will go to “refinancing of existing Standard Chartered Bank loan in Uganda”, according to IFC.

IFC, which is expected to decide on the loan request in May 2023, said the credit facility would “enable local value addition by a dairy company that is facing significant risks and shocks related to export bans, COVID- 19 and drought.

The news comes barely a fortnight after Kenya’s Trade and Investment Cabinet Secretary Moses Kuria said Lato had signed a deal with the State-owned financier Kenya Development Corporation (KDC) to invest jointly in dairy ventures.

Mr Kuria said Lato would invest in Kenyan milk factories that are currently struggling in a bid to revive them in what will see the Ugandan firm enhance its ability to compete with several established dairy companies such as Brookside and state-owned New Kenya Cooperative Creameries.

IFC expects Pearl Diary’s expansion project to increase dairy productivity and smallholder farmers’ access to the raw milk market in Uganda and Kenya.

“The Project will also contribute to food security by increasing the volume of dairy products sold to consumers,” said IFC.

“At the market level, the Project will help to strengthen the resilience of the dairy sector in the two countries by building capacity in dairy supply chain to withstand macro shocks and stresses related to droughts.”

Pearly Dairy already has a presence in Kenya where it is registered under the name “Musty Distribution” but doing business has not been a walk in the park.

Kenya has previously suspended milk imports from Uganda, affecting Pearl Diary’s revenues and increasing its costs of production.

However, Kenya’s President William Ruto recently lifted the ban on Ugandan agricultural produce such as milk, eggs and chicken, giving new hope to Pearl which was forced to lay part of its workforce in 2021 due to the export bans.

IFC support is the second of its kind to the Uganda-based dairy. In 2015, IFC loaned  $6.5m to Pearl Diary to establish a modern milk processing plant in Mbarara District

UGANDA – Pearl Dairy, Uganda’s leading dairy processing company, is seeking support from the International Finance Corporation (IFC) to enable it acquire a dairy plant in Kenya as well as boost its own to boost production of powder milk.

According to a disclosure from the investment arm of World Bank, the maker of Lato Milk has asked for a total of US$35m credit facility to support its ambitious expansion plans as well as enable it to refinance a commercial loan.

From the disclosure, US$ 21 million will be allocated to capital expenditure program which “including the upgrade and capacity increase of the powder milk plant in Uganda, and the acquisition of a packing plant in Kenya.”

At least US$14m will go to “refinancing of existing Standard Chartered Bank loan in Uganda”, according to IFC.

IFC, which is expected to decide on the loan request in May 2023, said the credit facility would “enable local value addition by a dairy company that is facing significant risks and shocks related to export bans, COVID- 19 and drought.

The news comes barely a fortnight after Kenya’s Trade and Investment Cabinet Secretary Moses Kuria said Lato had signed a deal with the State-owned financier Kenya Development Corporation (KDC) to invest jointly in dairy ventures.

Mr Kuria said Lato would invest in Kenyan milk factories that are currently struggling in a bid to revive them in what will see the Ugandan firm enhance its ability to compete with several established dairy companies such as Brookside and state-owned New Kenya Cooperative Creameries.

IFC expects Pearl Diary’s expansion project to increase dairy productivity and smallholder farmers’ access to the raw milk market in Uganda and Kenya.

“The Project will also contribute to food security by increasing the volume of dairy products sold to consumers,” said IFC.

“At the market level, the Project will help to strengthen the resilience of the dairy sector in the two countries by building capacity in dairy supply chain to withstand macro shocks and stresses related to droughts.”

Pearly Dairy already has a presence in Kenya where it is registered under the name “Musty Distribution” but doing business has not been a walk in the park.

Kenya has previously suspended milk imports from Uganda, affecting Pearl Diary’s revenues and increasing its costs of production.

However, Kenya’s President William Ruto recently lifted the ban on Ugandan agricultural produce such as milk, eggs and chicken, giving new hope to Pearl which was forced to lay part of its workforce in 2021 due to the export bans.

IFC support is the second of its kind to the Uganda-based dairy. In 2015, IFC loaned  $6.5m to Pearl Diary to establish a modern milk processing plant in Mbarara District.

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