Swiss coffee trading house Sucafina has secured a US$500mn two-year revolving credit facility through 16 banks, using blockchain-based platform Komgo for digitised trade documentation and stock monitoring.
The facility was bumped up from US$400mn after being “significantly oversubscribed”, Sucafina says in a statement. The company traces its roots to the trade in Palestinian Jaffa oranges in the early 20th century but now deals solely in coffee and bills itself as a “leading sustainable farm to roaster” coffee company.
The senior secured borrowing base facility has a tenor of two years with options for two extensions of up to a year.
The funds will be used to refinance an existing two-year US$300mn borrowing base facility originally struck in October 2017, and – along with other facilities already secured – will be used to fund the group’s trading activity.
ING is the sole bookrunner, coordinator and documentation agent in the syndication and its Geneva branch is the security agent and overdraft bank.
Citibank’s London branch, Rabobank, Natixis, Credit Suisse, HSBC, Raiffeisen, Société Générale, UBS and UniCredit joined as mandated lead arrangers ahead of syndication.
The other lead arrangers are: CA Indosuez, Industrial and Commercial Bank of China and Sumitomo Mitsui Banking Corporation.
Deutsche Bank is a lead arranger and Banque Internationale de Commerce and Banque Cantonale de Genève are arrangers.
“The successful close of our group’s flagship facility is a significant achievement against a challenging timeline,” says Sucafina’s group chief financial officer Philippe Penet.
“It represents a strong signal of support from our lending banks. I am grateful for the continued support of our existing lenders and would like to welcome seven new lenders to this facility.”
Komgo, a Swiss-headquartered fintech owned by a number of major trade finance banks, was appointed as the digital agent for the agreement. Sucafina will use Komgo’s stock monitoring tool within its Konsole solution, which automates weekly stock reconciliation at Sucafina’s 80 global warehouses.
The lenders will have access to invoices financed against the borrowing facility through Komgo’s document tracking tool Trakk, says the company’s chief financial officer Kris Van Broekhoven.
Trakk will be integrated with Sucafina’s accounting system and ING’s account settlement system, so that the status of the facility’s collateral will be updated automatically based on the invoices issued against it.
Van Broekhoven says it is the first time the company’s tools have been used in a large syndicated lending facility.
“In deploying this solution we took a very pragmatic approach focussing on specific pain points identified in the previous borrowing base facility,” Komgo’s head of sales Baptiste Audren tells GTR.
“With Komgo’s solutions we can make the next generation of borrowing base facilities more secure, less expensive to maintain and much more flexible to the needs of the borrower. ING and Sucafina are at the forefront of this innovation and have already taken the first step.”
The revolving credit facility has included a sustainability framework since 2019 and Sucafina says performance metrics were updated this year to focus on the number of certified farmers among suppliers and unspecified measures to reduce carbon footprints and deforestation in coffee-producing states. The company did not respond to a request for details on the sustainability measures.
Gregory Lambillon, ING’s head of trade commodity finance in Switzerland, says: “With the close cooperation with Komgo, Sucafina and ING, we have created a milestone in the industry transformation towards the digitalisation of trade flows.”
“ING was delighted to lead this anchor facility for Sucafina and ensure a smooth process and favourable outcome. Further investing in the agricultural value chain is a key pillar of our sector strategy.”