FMO, the Dutch entrepreneurial development bank and the Trade and Development Bank Group have co-arranged a sustainability-linked syndicated loan facility for ETC Group, growing from an initial $394 million to $600 million as new lenders joined a deal designed to strengthen agricultural value chains and working capital access across Africa.
The facility was originally signed at $394 million by FMO and TDB Group alongside DEG, FinDev Canada, the OPEC Fund for International Development and Proparco, with FMO Investment Management and ILX Fund participating.
Following an increased commitment from FinDev Canada and the addition of new participants including the Asian Development Bank, Cassa Depositi e Prestiti, Finnfund, Impact Fund Denmark and OeEB, the development bank of Austria, the facility expanded to $600 million.
The financing supports ETG’s operations primarily across Africa, with an additional component in Asia channeled through the Asian Development Bank and carries a sustainability-linked structure that ties the interest margin to ETG’s progress against agreed environmental and social performance targets.
The deal targets a structural weakness at the heart of African agriculture. Despite the sector’s centrality to the continent’s economy and livelihoods, smallholder farmers remain constrained by limited access to finance, inputs, infrastructure and formal markets.
By backing a company that connects farmers directly to structured markets while providing inputs, training and advisory services, the facility’s participants aim to strengthen food system resilience, improve food security and reduce greenhouse gas emissions.
The financing specifically supports trade in essential commodities including grains, pulses, oilseeds and fertilizers, stabilizing food supplies while working to enhance farmer incomes and expand participation by women and youth in rural economies.
Founded in Kenya in 1967, ETG has grown into a global operator present in more than 50 countries across six continents, with a diversified portfolio spanning agricultural inputs, chemicals, logistics, processing, food and food ingredients, energy, metals, technology and supply chain optimization.
The company’s core strength lies in connecting smallholder farmers to regional and global markets while supplying critical inputs such as fertilizers and seeds across the continent. ETG has set an ambition to reach one million African smallholder farmers with services aimed at improving production, crop quality, traceability and climate resilience.
The facility has already exceeded several of its impact targets relating to deforestation and reforestation, as well as the number of farmers including women, who have received extension services, while strengthening intra-African agricultural commodities trade flows, according to the participants.
Huib-Jan de Ruijter, Co-CIO at FMO, said the transaction reflects both ETG’s role in the sector and FMO’s broader capital-mobilization strategy.
“ETG plays an important role in connecting African smallholder farmers to markets, inputs and services,” de Ruijter said. “Through this sustainability-linked loan, we are supporting a long-standing client in strengthening its financing base while encouraging measurable progress on environmental and social priorities. This transaction also demonstrates how FMO can mobilize capital alongside partners to support sustainable private sector development at scale.”
Michael Awori, TDB’s Trade and Development Banking Chief Executive for the Eastern & Western African Region, framed the deal as an extension of a long-running institutional relationship.
“We are pleased to continue strengthening our longstanding collaboration with ETG working alongside partners such as FMO, through the extension of this sustainability-linked facility,” Awori said. “It allows us to reach those at the heart of Africa’s agricultural transformation, the smallholder farmers, agribusinesses, and traders who are driving regional food systems forward.”
Paul Van Spaendonk, Chief Treasury Officer at ETG, described the financing as reinforcing the company’s long-term commitment to the continent.
“Despite significant and rapid growth over the years, ETG’s commitment to the African continent remains steadfast,” Van Spaendonk said. “We are proud to partner with institutions that enable us to truly make an impact in the lives of people, whilst keeping a keen focus on addressing pressing issues pertaining to climate change and land conservation. We are enthused to continue this journey and to play our role in creating a sustainable future for generations to come.”
Pauliina Halonen, Senior Investment Manager at Finnfund, tied the investment to the fund’s sector strategy.
“This investment in ETG is closely aligned with Finnfund’s strategy and priorities,” Halonen said. “Agriculture is one of our key focus sectors because it plays a critical role in creating jobs, strengthening food security and supporting sustainable economic development in emerging markets. Through ETG’s extensive presence across agricultural value chains, we can help improve market access for farmers, increase productivity and resilience, and promote more sustainable agricultural practices. We believe this investment has the potential to generate both meaningful development impact and long-term commercial value, while contributing to more inclusive and resilient food systems.”
Søren Peter Andreasen, Deputy CEO of Impact Fund Denmark, pointed to the structural value-loss problem the facility addresses.
“Agriculture employs millions of people across Africa, but too much value is lost when farmers lack access to logistics, financing and markets,” Andreasen said. “ETG addresses this challenge at scale. What makes this investment particularly compelling is that the loan incentivises ETG to increase its support for women farmers, expand its advisory services and reduce deforestation.”
Isabel Chatterton, ADB Director General for Private Sector Operations Department, connected the facility’s Asian component to broader climate-resilience goals.
“ADB is helping smallholder farmers in India and Viet Nam adopt more sustainable production practices, access certification and fair market opportunities, and build resilience to climate risks through this financing,” Chatterton said. “Our partnership with FMO, other development finance institutions, and ETG demonstrates ADB’s commitment to building inclusive and climate-resilient agricultural value chains across Asia and the Pacific, while expanding opportunities for smallholder farmers, particularly women.”
Sabine Gaber, CEO and Member of OeEB’s Executive Board, framed the renewed partnership as central to Austria’s development finance priorities in Africa.
“We are pleased to renew our partnership with ETG, a longstanding client and key player in strengthening agricultural value chains across Africa,” Gaber said. “This financing will help secure access to essential food commodities, support local businesses and farmers, and contribute to economic resilience in the markets where ETG operates. The transaction closely aligns with OeEB’s strategic focus on sustainable private sector development, strengthening economic infrastructure and industry, and deepening our engagement in Africa, where we aim to create lasting development impact through responsible investments.”
The deal’s structure, anchoring interest costs to measurable sustainability performance, reflects a broader shift among development finance institutions toward instruments that align commercial lending directly with development outcomes, rather than treating environmental and social commitments as separate from the core financing terms.
For African smallholder farmers navigating persistent gaps in market access and climate resilience, the scale of this facility signals growing institutional confidence in agribusiness intermediaries capable of channeling large-scale capital directly into value chains that reach the farm level.
