Fidelity Bank Nigeria is providing a letter of credit (L/C) in support of a US$40 million pre-export facility from the African Export-Import Bank (Afreximbank) in favour of Nigerian cocoa processing and trading company, Johnvents Industries.

The facility will help support Johnvents' activities related to the production, processing, and export of goods or commodities and help the wholly-Nigerian owned firm establish a secure position in international trade.

Value-added processing

The term sheet provides for the facility to be used to finance commodities that had been received into approved warehouses or storage sites, to be processed into finished products for the export market.

It also provides that the facility, which is an uncommitted revolving pre-export facility, could be used to finance commodities in transit to the warehouse, with such financing supported by a standby L/C or guarantee posted by Fidelity Bank Nigeria.

IFC support

Johnvents is also seeking a senior secured loan of up to US$23.3 million from the International Finance Corporation (IFC).

The investment from the private sector arm of the World Bank Group will support the company's US$46 million expansion plan to increase its cocoa processing capacity; expanding gas power plants; finance fleet acquisition, and provide working capital.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.