IFC and BaF sign investment agreements

February 24, 2023 | 10:54
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On February 23, the strategic partnership announcement and signing ceremony of investment agreements between the International Finance Corporation (IFC) and BaF Vietnam Agriculture JSC took place at Vinpearl Landmark 81.
IFC and BaF sign investment agreements
The signing ceremony of investment agreements between the IFC and BaF

The signing ceremony was attended by Truong Sy Ba, chairman of the Board of Directors (BoD) at BaF, Bui Huong Giang, member of the BoD and CEO, Samuel Dzotefe, senior manager for Manufacturing, Agribusiness, and Services for Asia at the IFC, and senior leaders from both companies.

The IFC aims to invest in modern livestock farming enterprises that pursue integrated production with high biosecurity and production standards to promote an increase in the supply of safe pork. In Vietnam, BaF is a livestock producer applying a clean food ecosystem – the 3F FEED-FARM-FOOD model.

BaF has completed its 3F chain and owns 23 modern farms with a total herd of 200,000 pigs, two animal feed factories with a capacity of 260,000 tons per year, and has obtained GLOBALG.A.P. CFM 3.0 and FSSC 22000 V5.1 food safety management system certifications. The company also has a food distribution chain with about 60 Sibafood stores and 300 meat shops.

On February 20, the State Securities Commission approved BaF's private convertible bond offering. This is one of the final procedures to complete the IFC's investment in BaF.

IFC will provide an investment package of up to VND 600 billion ($26.1 million) in convertible bonds and VND 300 billion ($13 million) in bonds issued by BaF, totaling approximately $39 million..The proceeds collected from the offering will be used to support the growth of modern livestock farms with high-quality genetic breeds, animal feed factories, clean meat processing facilities, and slaughterhouses.

Giang said, "The collaboration between BaF and the IFC aims to support the development of farms and genetics in line with the best industry practices. With the guidance and support of the IFC, BaF will gradually transition from individual animal breeding to group breeding, ensuring compliance with the requirements for health, biosecurity, animal welfare, efficient use of resources, protection of natural biodiversity, and food safety."

"Other activities throughout the closed animal breeding chain such as feed production, transportation, slaughter, and distribution will also comply with the IFC’s standards," continued Giang.

Dzotefe added, "By supporting companies like BaF, we are promoting the development of more efficient and sustainable local private enterprises along the agribusiness supply chain. This will help boost competition and improve farming standards while supporting the food sector’s continued modernisation and the implementation of international best practices."

The IFC's funding and technical assistance will help BaF improve its implementation of environmental and social standards to meet its sustainable development goals.

This will be achieved by ensuring environmentally friendly and safe working conditions for employees, setting up and implementing animal welfare practices in line with international standards such as group-sow farming, using antibiotics responsibly as recommended by the World Health Organization, efficiently using natural resources, managing and minimising the environmental and social impact of project activities, and providing consumers with clean, high-quality, and safe vegetarian-fed pork products.

In addition, BaF will enhance its corporate governance by adopting internationally recognised standards. These improvements will contribute to the realisation of BaF’s strategy to become one of the three leading livestock companies in Vietnam.

The IFC – a member of the World Bank Group – is the largest global development institution focused on the private sector in emerging markets.

Supporting the livestock sector is a key focus of the IFC’s engagement in Vietnam in response to the African Swine Fever outbreak, which significantly reduced pig numbers in the country and disrupted the supply of pork – a primary source of protein.

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By Linh Dan

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