The Hongkong and Shanghai Banking Corporation Limited (HSBC), Italian Export Credit Agency (SACE) and NutifoodNutrition Food JSC (Nutifood) have just completed the arrangement of a $31-million 5-year untied offshore “Push” facility, supporting Nutifood’s capex and working capital including investments in new warehousing and the replacement of four existing filling lines for dairy manufacturing.
SACE provides the guarantee that covers 80 per cent of the loan. This is the first SACE Push concluded in both ASEAN and Vietnam and in the food industry, highlighting the strategic ongoing cooperation between HSBC and SACE to close transactions in priority markets.
The facility offers Nutifood access to long-term hard currency financing, supporting its growth and investments in the local and international milk market. HSBC acted as sole mandated lead arranger, lender and agent.
The Push programme which was launched in 2017 is a SACE initiative. With the aim of boosting the bilateral trade between the two nations, SACE proactively searches and connects buyers and suppliers in Vietnam and Italy. Through the scheme of the Push programme, this ECA can provide the guarantee for financing up to 12 years for foreign corporates with no limits regarding the nature of the goods and no requirement for available contracts between buyers (borrowers) and Italian suppliers.
Joining the Push programme, buyers’ access to funding could be easier thanks to SACE’s financial guarantee, simultaneously, they can enjoy SACE’s economic incentive once the target amount of procurement from Italy is reached within an agreed period from the signing of the facility, as well as join SACE’s match-making events twice per year, increasing opportunities to find suitable business partners.
“This landmark transaction between Nutifood and SACE, the first of its kind in ASEAN and Vietnam and the second in Asia, is a testament to HSBC's industry-leading capabilities in facilitating major transactions for our clients. It also underscores our ability to connect Vietnamese corporates with international experts leveraging our global network, and supporting the growth of Vietnam,” says Stephanie Betant, head of Wholesale Banking, HSBC Vietnam. “We are particularly thrilled to find innovative sources of financing for our customers and identifying optimal methods to access funding. We expect this historic transaction to increase bilateral trade between Italy and Vietnam.”
Key to this transaction is the agreement with Nutifood to foster its commercial relationships with Italian companies to increase the group’s procurement from Italy in the following years. Being the ultimate target of a Push facility, Italian small- and medium-sized enterprises (SMEs) will benefit from bid invitations and business-to-business meetings and matchmaking events organised by SACE.
“Through HSBC we had the opportunity to work with SACE, and this also gives us the chance to access advanced technologies offered by Italian companies. We are extremely honoured to be part of this deal and we are committed to using the allocated capital effectively to deliver sustainable development for Nutifood. We hope this will be the first step for us to cooperate in other projects in the future,” stated Huy Vo, Group CFO and chief accountant, Nutifood.
“We are proud to have concluded a new Push Strategy deal, another major contribution to the growth of Made in Italy, one of the main drivers of the Italian economy. Since the launch of the Push Strategy programme, we have mobilised resources for over €2.8 billion, supporting Italian SMEs in their business with large buyers in emerging markets. We are glad to collaborate with two global key players such as HSBC and Nutifood in this transaction," said Livio Mignano, head of International Network, SACE.
Since the inception of the Push programme in 2017, HSBC has arranged eight Push facilities and together with SACE is currently evaluating new opportunities in Southeast Asia ranging across several sectors like agribusiness, power, petrochemicals, and furniture manufacturing and for an overall amount of around $800 million.