TriLinc has provided financing to a textile and clothing distributor located in South Africa. Incorporated in 1999, the borrower has expanded its business operations to include an Australian offshore clothing wholesaler and a Hong Kong-based sourcing warehouse. In South Africa, the borrower provides a range of services to its retail business customers, including trend forecasting, product design and development, production sourcing and planning, inbound and outbound logistics, and management of replenishment stock and order packaging. It is anticipated that TriLinc’s financing will enable the borrower to continue to increase its number of employees and expand its market presence in South Africa. The transaction is part of a revolving trade finance facility that is secured by inventory and receivables. The borrower prides itself on servicing the growing South African retail market through catalyzing the supply of clothing and textiles to a variety of market segments, including the low-income, budget-conscious, mid-priced, and high quality categories.
South Africa is classified as an upper middle income country by the World Bank.1 Between 2010 and 2013, GDP growth rates averaged approximately 2.8%.2 Major exports include gold, diamonds and platinum (world’s largest producer).3
South Africa meets TriLinc’s country standards for its performance across relevant growth, stability and access metrics.4 In 2013, it ranked 41st in the world and third across the region on the World Bank’s Ease of Doing Business index.5 As the second largest economy in Sub-Saharan Africa, the country benefitted from the $32 billion in direct foreign investment that was estimated to have flowed through the region in 2013.6 Robust domestic demand across Sub- Saharan Africa has helped spur real GDP growth of up to 4.7% in 2013, and is expected to remain stable at 4.7% in 2014.6 Looking ahead in 2015 and 2016, overall regional GDP growth is projected to strengthen to 5.1%.6
Additional Sustainability & Impact Highlights
- The borrower targets job creation as the primary impact objective of its business activities.
- The borrower is a responsible corporate citizen that provides both in-kind and monetary donations to employee-selected local charities on an annual basis. For example, the borrower has historically focused on empowerment through education as a cornerstone of its corporate citizenship policy by providing used computers to local schools.
- Conscious of its environmental impact, the borrower implements energy efficient lighting and recycling programs at its facilities.
1World Bank, Doing Business 2014, Economy Profile: South Africa. 2World Bank, World Development Indicators Database, 2014. 3CIA, The World Factbook, 2014: South Africa. 4There is no assurance that our investment in this company or this market will be successful. 5The World Bank, Doing Business 2014, Understanding Regulations for Small and Medium-Size Enterprises. 6The World Bank, Global Economic Prospects, 2014.
The above information is as of the initial date of investment: July 25, 2014.
This borrower is no longer in TriLinc’s portfolio.
TriLinc originally performed an SDG mapping exercise in December 2017 to map all of our borrower companies, both current and exited from our portfolios, to specific SDGs based off of business activity. TriLinc’s official SDG alignment methodology was not finalized until June 30, 2018. For borrowers that had exited TriLinc’s portfolios prior to this time period, the selected SDGs for these borrower are a reflection of what TriLinc believes would have been the SDG alignment if 1) the SDGs had been in effect and 2) TriLinc had integrated the SDG alignment while the company was in the portfolio. The SDG mapping presented does not include input from Investment Partners or borrower companies given that the companies were no longer in the portfolio when the alignment was finalized.
There is no guarantee that TriLinc’s investment strategy will be successful. Investment in a non-listed LLC involves significant risks including but not limited to: ownership is restricted; no secondary market; limitation on liquidity, transfer and redemption of ownership interest; distributions made may not come from income and, if so, will reduce the returns, are not guaranteed and are subject to management discretion. TriLinc selects investments and conducts operations on behalf of its clients, and will face conflicts of interest. Investment with TriLinc is not suitable for all investors. Securities Offered through CommonGood Securities, LLC, a member of FINRA and SIPC.
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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