European Union funded Yield Uganda; an Investment Fund has made its maiden investment in Uganda committing Shs1.6 billion to Sesaco Limitd, a soy processing company.
The investment aims at improving the company’s
production facilities while stabilising and preparing the business for a larger expansion and growth in the future.
As part of Yield Fund package, Sesaco will enjoy benefits from Business Development Support to the technical and governance aspects of the business. A family-owned company, Sesaco is located in Kyengera Town, near Kampala.
It processes, packages and sells several high-protein soy products, including soy cup, and soy, maize and millet flours which have various nutritional benefits.
Majority of customers for Sesaco’s products are NGOs and institutions which provide food to underprivileged and malnourished persons, including refugees.
“We are excited to have Yield Fund for believing in us and investing in our business. Their commitment to supporting the agribusiness sector in Uganda will be encouraging to many. We also look forward to an interesting relationship with the PCP team which has considerable experience investing in agribusinesses in the entire East African region,” said Sesaco’s founder and Chief Executive Officer, Charles Nsubuga.
The European Union Ambassador. Attilio Pacifici expressed his satisfaction with completion of the Fund’s maiden investment.
“The first investment of Yield Fund marks an important milestone. It is the result of continued efforts and commitment from the European Union to support the agribusiness sector by lowering the cost and risk of investment. In accessing long-term capital needed for the modernization and expansion of their business, Sesaco is expected to create jobs and contribute to Uganda’s economic growth,” he said.
The International Fund for Agricultural Development (IFAD) is involved in the management of Yield Fund.
Speaking on behalf of IFAD, its Country Manager Alessandro Marini said, “IFAD is pleased with this first investment of Yield Fund to Sesaco. The vision of the company to expand its network of smallholders and improving nutrition offering in the country is a journey that we are happy to support. IFAD is keen to support the local agro-SMEs, like Sesaco, who provide a positive impact proposition and clear linkages and markets to the smallholder farmers of Uganda”.
Edward Isingoma Matsiko, PCP Partner responsible for the transaction said: “Sesaco is a story of hard work, commitment and passion. With this
Investment of Yield Fund, we believe the company will be able to modernize its operations and increase efficiency”.
The business has enormous growth potential: with increased production from farmers who will benefit economically from soy farming and better internal operations, Sesaco will deliver a greater product to the Ugandan consumer.
“We are delighted to spearhead the company’s growth in this first phase of our investment.”
The Fund was launched in January 2017 with commitments of €12million, anchored by €10 million from the European Union (EU) through the International Fund for Agricultural Development (IFAD), and €2million committed by National Social Security Fund Uganda (NSSF).
The Fund offers innovative financial products such as equity, semi-equity and debt funding.
Additionally, an integral and complementary part of the Fund’s investment process will be used to support the operations of its investee companies through matching grants for Business Development Support (BDS) funded by the EU.