April 6, 2021
IDB Invest, a member of the IDB Group, is mobilizing financing worth $80 million for the Ecuadorian company Corporación Favorita C.A., the largest self-service store chain in Ecuador and one of the largest companies in the country.
The deal involves a resource mobilization financing with funds from IDB Invest to Corporación Favorita in 2020. A separate $230 million loan will serve to partially finance the company’s multi-year growth plan in Ecuador. Resource mobilization, on the other hand, will support its expansion in Panama through the construction of a new national distribution centre for its subsidiary Rey Holdings Corp., one of the largest self-service chains in that country.
The financing seeks to increase the access of the local population to quality products both in Ecuador and Panama, also having a positive impact on Corporación Favorita’s value chain. The deal also provides for increased employment, growth in exports of products from small- and medium-sized Ecuadorian companies to Panama, and greater accessibility to quality food and products in underserved areas due to a greater number of points of sale.
The financial package, led by IDB Invest and syndicated with seven international banks, includes an uncommitted $5.5 million worth of blended financing from the Canadian Climate Fund for the Private Sector of the Americas (C2F). C2F’s participation will focus on the installation of photovoltaic solar roofs to meet on-site energy needs.
The deal potentially contributes to three of the United Nations Sustainable Development Goals: Decent Work and Economic Growth (SDG 8), Responsible Consumption and Production (SDG 12) and Partnerships for the Goals (SDG 17).
As a result of the work with IDB Invest, Corporación Favorita is committed to improving the functioning of its corporate governance and its environmental and social risk management system. In addition, the advisory services will support Corporación Favorita in the implementation of actions aimed at increasing gender equality, diversity and inclusion in the company.