Borrower Overview
 

TriLinc has provided financing to a waste management equipment distributor in South Africa. Established in 2003, the borrower imports and distributes a wide variety of machinery and equipment for public and private sector clients throughout the country, ranging from rock crushers and shrub mulchers to wood chippers and tire shredders. The borrower aims to provide its customers with highly innovative and state-of-the-art equipment that reduces waste and minimizes environmental impact. The borrower consistently strives to satisfy demand through customized solutions in line with the latest technologies and international trends in the global marketplace. The borrower is a small enterprise with positive growth prospects and a customer-centric approach to doing business. Proceeds from TriLinc’s financing were used to provide the borrower with short-term liquidity for the purchase and import of equipment for sale to the City of Johannesburg’s exclusive recycling and waste management service provider. TriLinc’s loan will also support the borrower’s efforts to promote the participation of women and minorities in the work place.

Market Overview

South Africa is classified as an upper middle income country by the World Bank.¹ Between 2010 and 2014, annual GDP growth rates averaged approximately 2.4%.¹ South Africa’s main exports have traditionally been concentrated in gold, diamonds, platinum, other metals and minerals, and machinery and equipment.² Conversely, the country’s main imports have been focused in machinery and equipment, chemicals, petroleum products, scientific instruments, and foodstuffs.²

South Africa meets TriLinc’s country standards for its performance across relevant growth, stability and access metrics.³ In 2014, it ranked second across the Sub-Saharan African region on the World Bank’s Ease of Doing Business index.⁴ As the second largest economy in Sub-Saharan Africa,⁵ the country benefitted from the $37 billion in net foreign direct investment that was estimated to have flowed into the region in 2014.⁶ Robust domestic demand across Sub-Saharan Africa helped spur GDP growth to 4.6% in 2014.⁷ Looking ahead, overall regional GDP growth is projected to strengthen to 5% by 2017.⁷

Additional Sustainability & Impact Highlights

• The borrower’s imported equipment directly supports the City of Johannesburg’s efforts in executing its Growth and Development 2040 strategy and becoming a city that provides sustainability for citizens.⁸
• The borrower focuses on gender and minority equality and empowerment and implements human resource policies that promote fair hiring and recruitment, fair career advancement, fair compensation, and prevent sexual harassment.
• The borrower is one of only a few black-owned and operated companies that provide environmental management and waste management solutions in South Africa.
• The borrower provides financial support to local social service charities that serve underprivileged and at-risk children and women throughout South Africa.

¹The World Bank, World Development Indicators Database, South Africa, 2015. ²CIA, The World Factbook, 2015: South Africa. ³The World Bank, Doing Business 2015, Going Beyond Efficiency, 2014. ⁵The World Bank, World Development Indicators Database, 2015.⁶The World Bank, Data, Sub-Saharan Africa, 2015. ⁷The World Bank, Global Economic Prospects, June 2015. ⁸Statistics South Africa, Quarterly Labour Force Survey – Q4: 2014, February 2015.

The above information is as of the initial date of investment: February 13, 2015.

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.

RISK FACTORS
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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