Jalles Machado (IFC-39264)

Countries
  • Brazil
Where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Approved
Bank Risk Rating
B
Risk rating varies among banks and may refer only to the particular investment and not to the risk for the project as a whole. Projects marked 'U' have an 'Unknown' risk rating at the time of disclosure.
Voting Date
Oct 6, 2017
The estimate day the bank will vote on a proposed investment. The decision dates may change, so review updated project documents or contact the EWS team.
Borrower
JALLES MACHADO SA
The holder of the loan, grant, or other investment.
Sectors
  • Agriculture and Forestry
  • Energy
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, etc.
Loan Amount (USD)
$ 34.00 million
Value listed on project documents at time of disclosure. If necessary, converted to USD$. Please review updated project documents for more information.
Investment Amount (USD)
Not Disclosed
When disclosed, the bank did not provide this value. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Feb 12, 2018

Disclosed by Bank Jun 27, 2017


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Project Description

Jalles Machado S.A. (“Jalles Machado” or the “company”) is a sugar/ethanol producer in Brazil operating two mills, Jalles Machado and Otavio Lage in the State of Goiás in Brazil. The company has a crushing capacity of 4.6 million tons/year of sugarcane and operates over 65.4 thousand hectares of land under cultivation for sugar cane. During FY17, the company produced 187.7 thousand tons of sugar (conventional and organic), 67,300 m3/year of anhydrous ethanol and 134,400 m3/year of hydrous ethanol and generated 279,389 MWh electricity through cogeneration.The proposed investment will support the company’s investment program to (i) plant 20,646 ha of sugarcane, including 3,000 ha of planting expansion, (ii) install a white sugar processing plant at the Otavio Lage mill with capacity of 750 tons of sugar per day, and (iii) irrigation of 3,500 ha which includes fertigation using vinasse. The latter will consist of subsurface drip (250 ha) and pivot irrigation (3,250 ha).

Expected Development Impact
(i) Support the expansion of a globally competitive sector: The investment will support the development of Brazil's sugar and ethanol industry, one of the most important sectors in the Brazilian economy, by helping one of the leading companies to improve efficiencies and upgrade its operations. (ii) Promote climate change mitigation: The project will support climate change mitigation by increasing efficient production of biofuels. Hydrous ethanol made from sugarcane is the most competitive CO2 alternative to gasoline and one of the "greenest" fuels. (iii) Strengthen a frontier region: The Company's operations are located in Goianesia, part of the Cerrado region, where the project will be undertaken. By expanding the company's activities, the project will create about a 100 new jobs and contribute to government revenues in a region that is highly dependent on the agricultural sector for income generation but has lagged behind national averages in terms of development indicators. (iv) Contribute to government revenues: The Brazilian agribusiness sector is highly competitive globally and is key to the economy in terms of its capacity to raise government revenues. This investment will allow the Company to expand its operations and will contribute to the growth of the Brazilian economy.

IFC's Expected Role and Additionality
(i) Long-term Financing: IFC's involvement will provide the Company with the necessary financing for its capital expenditures which is not otherwise available in the market on comparable terms. (ii) Mobilization: IFC will mobilize additional long-term capital from a commercial bank through the B-Loan program, expanding the Company's access to finance further. (iii) Environmental and Social Standards: By introducing the Performance Standards on Social and Environmental Sustainability, IFC will help Jalles Machado further improve its sustainability practices. (iv) Corporate Governance: IFC will help Jalles Machado strengthen its Corporate Governance policies and practices by implementing the Corporate Governance Improvement Plan.

Investment Description
  • International Finance Corporation (IFC)

IFC is considering a financing package of an A-Loan of up to US$34 million.

Contact Information

CONTACT

For Inquiries About the Project:
Jalles Machado S.A.
Rodrigo Penna de Siqueira
Chief Financial Officer
+55 (62) 3389-9000
rodrigo@jallesmachado.com
Rodovia GO 080 Km 75,1 – Fazenda São Pedro s/n – Zona Rural – Goianésia – GO – CEP. 76.388-899 - Bra
http://www.jallesmachado.com/

For Inquiries and Comments About IFC:
General IFC Inquiries
IFC Communications
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

Local Access for Project Documentation:
Contact Person: Rodrigo Penna de Siqueira
Company Name: Jalles Machado S.A.
Address: Rodovia GO 080 Km 75,1 – Fazenda São Pedro s/n – Zona Rural – Goianésia – GO – CEP. 76.388-899 - Brasil
Phone: +55 (62) 3389-9000
Facsimile: +55 (62) 3389-9099

ACCOUNTABILITY MECHANISM OF IFC

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org. You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org/