British International Investment (BII), the UK’s development finance institution (DFI) and impact investor, on Monday announced a $15-million equity investment into Singapore-headquartered agricultural commodity trading house Valency International (Valency).
The transaction, subject to regulatory approval, is expected to close early next year.
In addition to its commitment of $15 million, BII has the option to invest a further $35 million in equity into Valency within two years of completion of its initial investment.
According to a company release, the investment will fund the business expansion of cashew-processing and warehousing facilities in Nigeria.
Agriculture is a key contributor to Nigeria’s economy, accounting for a quarter of total gross domestic product and employing more than one in three Nigerians.
The new Valency facilities that will be funded by BII aim to respond to the agricultural sector’s growth opportunity in Nigeria by strengthening partnerships that maximise output with local farmers and processing centres that provide a more stable supply of premium-quality products.
According to the release, the investment into Valency builds on the strong links between the UK and Singapore, as illustrated in the elevation of the bilateral relationship to a strategic partnership in September this year.
The Valency investment comes on the back of two recent investments announced by BII at COP28. It has committed $7 million to the final close of the Circulate Capital Ocean Fund l-B, which invests in circular economy solutions, particularly plastic waste recycling, in South Asia and Southeast Asia. BII has also committed $6 million to support the first fund of Wavemaker Impact, a climate-tech venture builder in Southeast Asia.
These investments contribute to BII’s ambitions to invest up to £500 million ($627 million) in climate financing in Southeast Asia and form part of its overall goal to target 30% of total new commitments to climate.
“BII’s recent investments demonstrate the strong UK-Singapore relationship and a common vision to support growth in emerging markets that is productive, sustainable, and inclusive. We are committed to increasing climate finance in South and Southeast Asia and supporting businesses that can help protect the environment, reduce emissions, and adapt to the changing climate. Our investments with Circulate Capital and Wavemaker Impact will further this commitment,” said Srini Nagarajan, Managing Director and Head of Asia at British International Investment, in the release.