Pran gets $50m from IFC for expansion

The International Finance Corporation (IFC), the private sector investment arm of the World Bank, is set to provide $50 million (about Tk 420 crore) to Pran Group, Bangladesh's leading agro processor, to help create market for farmers.

Under the deal, $30 million (about Tk 250 crore) will be provided as loan to Pran Agro Business for expansion of its existing food business comprising fruit juices, biscuits and noodles. The other $20 million (about $170 crore) would be local currency working capital facility for Pran Agro and Natore Agro.

The financing raised will be used to develop new facilities and expand current operations, said Eleash Mridha, managing director of Pran Group.

These include setting up an aseptic pulping facility in Godagari upazila of Chapainawabganj to increase its fruit-based beverage capacity, raising its production of spice products and noodles, and modernising its existing operations, he said.

The financing agreement, which was approved on June 7, is expected to help Pran increase its farmer network by procuring raw materials from an incremental 10,000 farmers, thus contributing to market creation for these farmers, IFC said in its project documents.

Thanks to the expansion, Pran will utilise raw materials from field level and in so doing, will be able to cut its production cost and pay farmers a proper price, Mridha said. “At least 1,500 new jobs will be generated directly by the expansion project.”

Pran would also be able to export the mango pulp produced at the Godagari plant, Mridha said. At present, it supplies mango pulp locally.

Established in 1981, Pran has gone on to become a household name in Bangladesh.

It produces more than 400 food products in at least 10 major categories -- including juices and drinks, snacks, dairy, spices, confectionary and frozen foods -- and exports to 134 countries.