SAMANU (54 Capital FMCG Group of companies) is a platform company with well-established brands operating in Ethiopia’s main FMCG sub-sectors (Tena Edible Oils, 555 and Aura Soap & Detergents, and Chef Luca wheat products). It has announced a $ 21 Million growth capital investment in Ethiopia from Norfund, a Norwegian investment fund focused on building sustainable businesses and industries in developing countries, to increase local production of Edible Oil and expanding into Agro-processing that will create jobs, increase food security, and provide income for up to 200,000 smallholder farmers.
Saad Aouad, 54 Capital FMCG PE Advisors’ Chief Investment Officer, said, “It is a fantastic achievement for our investments in Ethiopia and our local management team to receive further institutional support. It is a testament to what we have achieved in terms of nurturing high-quality, popular brands and achieving scale through capacity expansion and how we intend to develop the next phase of the business. This investment demonstrates the robustness of this strategy to further enhance the value chain in Ethiopia, which will undoubtedly benefit from Norfund’s extensive experience across the continent.”
Joachim Yebouet, 54 Capital FMCG Chief Executive Officer, said, “We are very excited about the future. This is a step towards our vision of improving the lives and livelihoods of Ethiopians by leveraging the country’s abundant natural resources and talent. The substantial new foreign investment will strengthen our presence in Ethiopia and contribute to the broader development agenda. Backward integration will enable structured local edible oil production while developing Ethiopian agriculture.” The investment by Norfund will fund the construction of a new solvent extraction plant to produce edible oils based on locally sourced sesame, sunflower and soya beans in its refineries. By reducing the dependency on imported raw materials, the investment aims to create jobs in value-addition and increase Ethiopia’s food security. The completion of a vertical integration project will also allow for increased export opportunities within the sectors the company already operates. To ensure enough volume of locally produced oilseeds for its refineries, the company intends to develop large oilseeds clusters in Ethiopia over the next six years, providing livelihoods for 200,000 smallholder farmers. In the first six months post investment, the objective is to identify 642 clusters and sign contracts with around 5-7000 smallholder farmers. Norfund, through its Business Support Facility, plans to use grant funding to assist contracted smallholder farmers with inputs like high quality seeds, fertilizers, training and capacity building, as well as agricultural technology to boost productivity.
Andreas Davidsen, Norfund’s VP of Scalable Enterprises – Agribusiness & Manufacturing, said: “We are excited to partner with SAMANU and support the execution of their vertical integration strategy, creating jobs and increasing food security. We strongly believe in the opportunities of local food production in Ethiopia and Norfund looks forward to working closely with the SAMANU management team and 54 Capital to help implement best in class practises and solutions”. SAMANU (54 Capital FMCG Group of companies) is already home to some of Ethiopia’s leading FMCG brands and has ambitious plans to expand its product offering to meet rising demand for high quality locally produced brands. The investment, Norfund’s first in manufacturing in Ethiopia, signals strong institutional backing for the platform.
ABOUT 54 CAPITAL: 54 FMCG is a leading business group in Ethiopia. Our mission is to migrate Ethiopia from a heavily import reliant and raw resources export country to a self-sufficient manufacturing hub by developing companies and brands of high global standards that Ethiopians can enjoy every day. We began our journey in 2013 through an investment in a small refinery and quickly expanded into other FMCG products. We now have some of the most iconic local FMCG brands, making us the fastest growing conglomerate in Ethiopia. Today 54 FMCG is home to several notable FMCG brands such as Tena Edible Oil, 555 Household Care, Chef Luca Pasta and Aquasafe Natural Mineral Water. Going forward, 54 FMCG plans on taking ambitious steps to further expand its portfolio through investments in direct manufacturing and the vertical integration of its businesses. For more information, please visit www.54capitalfmcg.com (https:// www.54capitalfmcg.com/)
ABOUT NORFUND: Norfund is the Norwegian Investment Fund for developing countries. Our mission is to create jobs and to improve lives by investing in businesses that drive sustainable development. Norfund is owned and funded by the Norwegian Government and is the Government’s most important tool for strengthening the private sector in developing countries, and for reducing poverty. Norfund’s mandate is defined by the Norfund Act of 1997. The Act states that Norfund’s role is to assist in building sustainable businesses and industries in developing countries by providing equity capital and other risk capital. Norfund helps to build sustainable businesses that would not otherwise be developed because of the high risks involved. Norfund’s main investment region is Sub-Saharan Africa. Norfund also invests in selected countries in Asia and Latin America.