In a disclosure, IFC said its board has approved the straight senior local currency loan to support Jointown in procuring pharmaceutical products to meet the surge in demand from health institutions.
Founded in 1999, Wuhan-headquartered Jointown procures pharmaceutical products and small medical devices and sells to hospitals, clinics, and pharmacies throughout China. Brothers Baolin Liu, Shulin Liu, and Zhaonian Liu collectively own 48.27 per cent of the company’s share capital. The remaining shares are owned by public investors.
Most of Jointown’s warehouses and distribution centres are mainly located in frontier regions.
IFC said that while layoffs are being anticipated in a number of sectors in China in view of the worsening global economic conditions, Jointown will continue to hire more staff given the growing demand for health-related services, along with the coming on stream of its various new or upgraded facilities.
“Jointown and peer companies play an important role in ensuring reliable and timely delivery services of essential supplies to hospitals and clinics, thereby supporting the healthcare system to be able to continue its operations,” IFC said.
Despite the Chinese firm’s essentiality during the pandemic, it still faced difficulty in obtaining loans with a tenor of more than three years from commercial banks, prompting IFC to come in.
The loan will be IFC’s second for Jointown. Last year, it provided a local currency loan of 1 billion yuan ($143 million) to support Jointown’s business expansion, including the construction of up to five new product distribution centres and an upgrade at four existing warehouses in middle and western China.
IFC added that it is expected to share with Jointown its successful experience of rapid crisis response efforts, the ability to support real sector clients on addressing liquidity constraints or working capital requirements, and the support to retain jobs and employment in countries of operation, among others.
On its website, IFC said it is providing $8 billion in fast-track financial support to existing clients to help sustain economies and preserve jobs during this global crisis, which will likely hit the poorest and most vulnerable countries the hardest.
In Asia, Its COVID-19 response financings include $35 million to Bangladesh Prime Bank and $40 million to City Bank, $25 million to Cambodia’s Hattha Kaksekar Limited, $150 million to Vietnam Prosperity Joint Stock Commercial Bank, $35 million to India’s JK Paper and $150 million to China’s Muyuan Foods.