Country Bird borrows $25m from World Bank unit

The IFC, a member of the World Bank that funds privatesector ventures in developing countries, will invest the $25m in the form of a five-year convertible loan with a variable interest rate. "The proposed transaction will result in a long-term strategic relationship with the IFC," Country Bird said on Friday, 15 March 2013.

The funds will be used to increase chick production in Zambia and Botswana, expand feed-mill capacity in Zambia and increase broiler meat processing capacity. Further, it would be used to construct soya bean deactivation plants at two of the group's feed mills.

The expansions entail increasing day-old chick production to 14.6-million per year from 12.8-million at its Ramaphatle breeder farm in Botswana, and to 26.8-million from 12.4-million at Chainda farm in Zambia.

Country Bird would also increase feed-mill capacity from 60,000 tons to 108,000 tons per annum in Zambia.

The chicken-processing capacity at the Mafikeng plant would be increased to 41.4-million a year from 28.8-million. Soya deactivation plants would be installed at two of Country Bird's feed mills in SA, according to the group's website.

The IFC would have an option to convert the loan into Country Bird ordinary shares in the first two and a half years at a strike price of R4.90 a share. This is provided its shareholding would not exceed 18% and that the conversion would be at a minimum of $5m per tranche.

Country Bird's share price rose 2.18% to R3.75 on Friday, bringing the gains over the past six months to 15.4%. The share price rose sharply last month on news that SA planned to impose antidumping duties on imported Brazilian chicken.

Source: Business Day