Borrower Overview
TriLinc provides financing for small and medium size enterprises (“SMEs”) primarily in developing economies, that provide the opportunity to achieve both competitive financial returns and positive measurable impact. TriLinc has provided a loan to a manufacturer of low-cost diapers for babies in Peru and the surrounding region. The borrower is growing rapidly and expects the financing from TriLinc to allow it to both increase the number of employees and expand their product line to include adult diapers. Currently, the borrower produces the only affordable disposable diaper for lower-middle income Peruvian households. Access to disposable diapers helps to maintain hygiene in the home since many households have no laundry facilities or hot water for sterilization. The company has been in business since 2009, and plans to expand capacity to produce over 104 million diapers per year by 2016. Property, equipment and accounts receivable provide collateral that help support the facility.
Market Overview
Peru is the seventh largest economy in Latin America and is classified as a middle income country by the World Bank.1 Real GDP growth over the last 5 years (2008-2012) has averaged more than 6.5%.1 Since 2002 (2002-2012), real GDP growth has averaged nearly 6.4%.2 Major export sectors include copper, gold, zinc, textiles, chemicals, pharmaceuticals, machinery, and fish meal.
Peru meets TriLinc’s country standards for its performance across relevant growth, stability and access metrics.3 It has been one of the fastest growing economies in the world in recent years, with a steadily improving macroeconomic environment including foreign reserves.4 In 2013, it ranked second out of 32 countries in Latin America and the Caribbean on the World Bank’s Ease of Doing Business index.5
Additional Sustainability & Impact Highlights
- The borrower provides jobs that pay competitive wages that are on average approximately 45% above national averages6
- By developing additional products and distribution channels, the borrower has indirect impact on job creation for local third party distributors
- In addition to manufacturing disposable diapers which helps to maintain the hygiene in the home of the consumer, the borrower actively engages in minimizing negative impacts of its products on the environment through waste reduction programs and efficient operations initiatives
1 IMF, World Economic Outlook Database, April 2013 2IMF 2013 3There is no assurance that our investment in this company or this market will be successful. 4World Bank World Development Indicators Database, 2013 5World Bank, Doing Business 2014, October 2013 6World Bank, World Development Indicators Database, 2012.
The above information is as of the initial date of investment: December 6, 2013. In certain limited situations as needed, TriLinc directly manages an investment formerly managed by a former Investment Partner.
This borrower is no longer a TriLinc fund investment.
An investment with TriLinc carries significant fees and charges that will have an impact on investment returns. Information regarding the terms of the investment is available by contacting TriLinc. This is a speculative security and, as such, involves a high degree of risk. Investments are not bank guaranteed, not FDIC insured and may lose value or total value. Some investments may have been made in an investment vehicle that is no longer open for investment. The highlighted investment may or may not have been profitable. There is no guarantee that future investments will be similar.
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