Business

Online retailer Twiga Foods taps IFC in Sh3.2 billion loan deal

Friday, October 30th, 2020 00:00 | By
Online retailer Twiga Foods taps IFC in Sh3.2 billion loan deal.

Multilateral lender International Finance Corporation (IFC), has approved a Sh3.2 billion ($30 million) loan facility for Twiga Foods to stabilise food production and distribution to Kenya’s urban centres.

The funds will be channelled through tier-one banks, with the first phase set to be handled by KCB Group.

“The funding will ensure the stability of year-round supply of fresh fruit and vegetable volumes that are readily available, affordable, and of high-quality to Kenya’s urban markets,” said Twiga Foods Chief executive Peter Njonjo.

Njonjo noted that the move  targets more than  300 medium scale farmers, mainly Small and Medium Enterprises (SMEs) and Very Small Enterprises (VSEs) who have limited banking and operating track records, or lower levels of collateral.

Aggregates retail

The company aggregates informal retail demand and organises an efficient supply chain for fresh and dry goods through a technology enabled B2B platform.

According to Njonjo who is also the firm’s co-founder, the new initiative lines up strategically with the Government of Kenya’s Agricultural Sector Transformation and Growth Strategy, which aims at boosting food security in the medium term through modernising and scaling commercial farming for the domestic market.

“This initiative seeks to support over 300 irrigated medium-scale contract farmers to complement Twiga’s seasonal smallholder farmer supply base,” said Njonjo.

Twiga Foods which boosts of $10 million revenues (Sh1.08 billion) is a mobile-based food supply system for Kenya’s urban retailers that links farmers and vendors to the markets, providing a complete supply chain for quality produce in urban areas.

The program will be supported by the Global SME Finance Facility (GSMEF) and Women Entrepreneurs Finance Initiative (We-Fi).

Last year, Twiga raised Sh504.4 million from France-based investor Creadev.

The deal saw the Mulliez family, one of the richest in the world, which controls the private equity (PE) firm, acquire a stake in the company.

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