Vietnam: IFC forges pact with Mekong Capital-backed agribusiness Loc Troi

The International Finance Corporation (IFC) has formed a partnership with Vietnamese producer of crop protection chemicals, Loc Troi Group, a company backed by Mekong Capital and Standard Chartered Private Equity, to roll out an advisory project that will provide sustainable agricultural standards and practices through Loc Troi’s rice production value chain.

The Vietnamese firm will get access to the IFC’s support and network in two years, through which it will develop agricultural standards and practices by the Sustainable Rice Platform (SRP), an international multi-stakeholder partnership, the parties said in a joint statement.

This advisory project is also sponsored by the Canadian government.

Commencing on December 7, it aims to make Vietnam’s agriculture sector expand its global market share, assure sustainable increase in profitability, and improve farmer livelihoods.

Under the partnership, the parties will roll out a training programme for around 4,000 farmers about new farming practices that will help them grow high-quality, high-yielding, and sustainable rice. The project will be implemented first as a pilot and subsequently scaled up.

The initiative goes in harmony with the Vietnamese government’s recent agricultural restructuring plan, which targets to enhance the sector’s competitiveness, amid a rising competition with other major exporters including Thailand, India, Pakistan, Cambodia and Myanmar.

Even as agriculture has been seen as one of Vietnam’s biggest advantages, the sector is slowing over the past two years. The new project looks to help the country better position its agriculture sector to respond to international market opportunities.

“This partnership allows IFC to contribute to the drive to reform Vietnam’s agriculture sector and unlock the door for farmers to access relevant knowledge, skills, and finance to improve their livelihoods in a sustainable manner,” said Kyle Kelhofer, IFC country manager for Vietnam, Cambodia, and Lao.

The IFC has been present in Vietnam for over two decades, lending support for the private sector through both financing and advisory. It has to date invested $5.6 billion in 120 project across the country, spanning infrastructure, manufacturing, agribusiness, renewable energy and financial sectors.

In an earlier interaction with DEALSTREETASIA, Vivek Pathak, regional director for East Asia and the Pacific at the World Bank Group’s private lending arm, said the IFC will probably look at investments in new sectors that facilitate sustainable growth of the country, such as technology.

“IFC brings significant global experience delivering knowledge and expertise in agriculture to help businesses provide better returns to shareholders and create brighter futures for farmers,” Huynh Van Thon, chairman of Loc Troi Group, commented on the new partnership.

Mekong Capital invested in Loc Troi, formerly An Giang Plant Protection, in 2008, and has not divested.

With a nationwide distribution network of 25 branches, and more than 5,000 dealers and retailers, the company dominates the market with a 20 per cent plus market share, the private equity firm said.

Loc Troi, which boasts to be the first in Vietnam to launch an agricultural science centre, is also the country’s second largest distributor of seeds, focusing on rice and hybrid corn seeds.

Loc Troi was also a portfolio company of other private equity investors in Vietnam, including VinaCapital and Vietnam Phoenix Fund (formerly DWS Vietnam Fund, managed by Duxton Asset Management), which in 2014 exited the firm to Standard Chartered Private Equity. Another existing PE shareholder in Loc Troi is PENM Partners.

Also read:

IFC invests $6.5m in Vietnam’s Pan Pacific

Vietnamese poultry business Bel Ga secures $4m debt from IFC

StanChart PE invests $40m in Vietnamese lifestyle platform N Kid

Vietnamese fintech app MoMo raises $28m from StanChart PE, Goldman Sachs

Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

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  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
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Singapore Reporter/s

In Singapore, we are looking to double our reporting team by this year-end to comprehensively cover the fast-moving world of funded startups and VC, PE & M&A deals. We want reporters who can tell our readers what is really happening in these sectors and why it matters to markets, companies and consumers. The ability to write precisely and urgently is crucial for these roles. Ideal candidates must have to ability to work in a collaborative, dynamic, and fast-changing environment. We want our new hires to be digitally savvy and ready to experiment with new forms of storytelling. Most importantly, we are looking for hard-hitting reporters who work well in a team. Collaboration and collegiality are a must.

Following vacancies can be applied for (only in Singapore).

Following vacancies can be applied for (only in Singapore).   

  • A reporter to track companies/startups that have raised private capital, and have the potential to become unicorns. SEA currently has over 40 companies with a valuation of over $100 million and under $1 billion.
  • A reporter who can get behind the scenes and reveal how funding rounds are put together, or why they’ve failed to materialise. She/he in this role will largely focus on long-format stories. 
  • A journalist to track special situations funds, distressed debt and private credit (from the PE angle) across Asia.