Puratos has closed on a €1 billion in financing as part of a plan to further its Cacao-Trace program.
The money comes from a group of private investors, including Barings as the lead account.
The first draw of the financing will be used to further Cacao-Trace, which helps cocoa farmers increase their revenue by producing superior cocoa and mastering the fermentation process.
The €1 billion long-term financing will support the purchase of more Cacao-Trace certified beans directly from the farmers, intensifying the collaboration with local cocoa communities. It will also be used for the construction of 10 cocoa post-harvest centers and three grinding lines in Central and South America, Africa and Asia through 2026.
The Cacao-Trace program was created in 2014 by Puratos & Belcolade, a brand from Puratos Group, which is an international manufacturer of ingredients for the bakery, patisserie and chocolate sectors.
Around the globe close to 50 million people, mostly located in tropical regions, are dependent on cocoa for their livelihoods. On average, cocoa farmers in West-Africa earn less than €2 per day, an income below the poverty line.
Cacao-Trace focuses on superior tasting chocolate, and in the process generates value for all — from farmers to consumers. The program trains farmers and helps them to deliver cocoa beans of superior quality, increasing their revenue through a premium price and a chocolate bonus of €0.10 per kilo of chocolate, on top of conventional farm gate price.
Today the premium price and chocolate bonus add up to the equivalent of three to four extra months of salary. Cacao-Trace is already active in several countries across the globe: Cameroon, Ivory Coast, Mexico, the Philippines, Papua New Guinea, Uganda, and Vietnam.
Following a thorough due-diligence process, a group of private investors agreed to finance Puratos and Cacao-Trace for an aggregate amount of €1 billion, demonstrating the relevance and long-term potential of Cacao-Trace, to transform the cocoa supply chain in a social and sustainable way.
The financing mechanics have been assessed by Peterson Projects and verified according to the ICMA [International Capital Market Association] principles of sustainable financing. Puratos completed this transaction together with BNP Paribas as lead arranger and Eubelius as legal and tax advisor.
This sizeable transaction marks Puratos’ first sustainable financing.
“Cacao-Trace is a long-term commitment by Puratos towards a sustainable cocoa supply chain. It goes far beyond the average industry standards for sustainable chocolate by creating value for everyone, starting with the cocoa farmers,” said Jean-Philippe Michaux, CFO and head of the sustainability steering committee at Puratos. “We are there on the ground, alongside farming communities to coach... farmers to grow higher-quality cocoa and give guidance to run plantations in a more sustainable way.”
He added that the financing was granted on a 20-year term, which shows both Puratos’ and its investment partners’ long-term vision.
“As a family company we think in terms of generations,” Michaux said. “This funding will help us accelerate our efforts and further improve the positive impacts for the chocolate communities. It is our commitment to you and to future generations to enjoy the best tasting chocolate for many years to come.