The Australian CBH Group has announced to grant a US$30mn shareholder loan to Interflour, One of Asia's leading flour millers, to support the flour milling and malting business turnaround plan
CBH and joint venture partner Origold have approved a US$60mn shareholder loan to strengthen Interflour’s balance sheet to ensure future sustainable operations and provide the Interflour team with a platform for future success.
Since 2005, Interflour has spent more than US$300mn on capital and maintenance expenditure, including approximately US$100mn for a malting facility in Vietnam and Mabuhay Interflour Mill in the Philippines, without any equity from CBH and with the majority of this being funded by debt.
CBH Chairman Wally Newman said, “The plan has successfully gained traction and Interflour is on track to improve underlying performance for the year ending 30 September 2019.”
“Interflour’s operations in South East Asia continue to have a solid long-term growth story as the region urbanises, incomes rise and diets change. The turnaround plan and shareholder loan that has been put in place will maximise the opportunity to generate value in the years to come.”
CBH chief financial officer Doug Warden said that CBH continued to have a strong balance sheet and cash flow and the provision of the shareholder loan to Interflour would not impact network investment or any other operations within the Group.
“We’re on track to spend more than US$162.68mn on CBH network capital and maintenance this year, including US$101.68mn funding 800,000 tonnes of new permanent storage as part of the Network Strategy.”