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IFC to make debt investment in Fairfax-controlled warehousing firm
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International Finance Corporation (IFC), the private-sector investment arm of the World Bank, plans to invest $44 million (Rs 330 crore) in agri-warehousing company National Collateral Management Services Ltd (NCML).

IFC will make the investment via non-convertible debentures issued by seven special purpose vehicles of NCML that will build seven grain storage silos, it said in a disclosure. The total estimated cost of these silos is Rs 506 crore.

The company will build the silos in Punjab, Haryana and Uttar Pradesh. In Punjab, the silos will be located at Batala, Jalalabad and Chhehreatta. In Uttar Pradesh, the silos will be at Basti, Deoria and Faizabad. Haryana’s sole silo will be at Sonepat.

NCML is building the grain storage facilities under a 32-year concession agreement awarded by the state-run Food Corp of India, the country’s biggest grain procurer. 

IFC’s planned debt investment comes almost a year after FMO, the Netherlands’ development finance company, said it would invest about Rs 320 crore in NCML to help it finance the construction of new silos for staple food products such as wheat and rice.

NCML was founded in 2004 and is one of a handful of private companies in India that specialise in providing post-harvest services like storage and preservation of grain, procurement and supply chain management, collateral management, testing and certification, weather intelligence and consultancy. It also provides loans to traders, producers and users of agricultural commodities. 

The company is majority owned by Fairfax India Holdings Corp, which is part of Canadian billionaire Prem Watsa-led Fairfax Financial Holdings Ltd. Fairfax took control of NCML in 2015 and has been slowly increasing its stake. 

The Canadian investment giant had initially picked up a 74% stake in NCML for Rs 800 crore. It bought another 12.43% stake in May 2017, which took its total stake to 86.99%. Last year it increased its stake to around 90%

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