- DFC provides 100% guarantee to WayCool for a loan from IndusInd Bank’s Impact Investing Group
- Loan to support WayCool’s journey into a global food supply chain and logistics player
- Funds will be used to invest in technology and expand food distribution business in South India
U.S. International Development Finance Corporation (DFC) has extended a 100% guarantee to WayCool Foods’ latest round of fund raise of U$5.5 Mn through debt financing from IndusInd Bank Ltd. It follows the Series C round of US$32 Mn led by Lightbox earlier this year. Setuka Partners LLP was the advisor to the current transaction.
DFC’s financing to WayCool comes through IndusInd Bank in the form of a 100% guarantee. The loan is to be deployed through IndusInd Bank’s Impact Investing division, which will support WayCool Foods’ expansion plans.
WayCool Foods plans to use the funds to introduce advanced technology, implement strict hygiene measures, and increase transportation efficiency to reduce food spoilage and improve farmer yields, thus contributing to food security. This will also allow the company to strengthen food distribution across South India.
Karthik Jayaraman, Co-Founder and CEO, WayCool Foods said, “WayCool has been steadily building necessary technology and operational capabilities to operate robust agrifood supply chains from soil to sale. We welcome DFC and IndusInd Bank as partners in this journey and believe that this partnership is an endorsement of WayCool’s ability to lead transformation within the sector.”
DFC, America’s development bank, provides financing to address critical challenges across emerging markets globally. The investment in WayCool Foods demonstrates DFC’s commitment to supporting India’s food and agriculture distribution sector. The investment has been finalized after a stringent due diligence process.
On associating with WayCool Foods, Ajay Rao, Director – Social Enterprise Finance Team, DFC, said, “We are proud to work together with the remarkable team at WayCool to solve some of the most pressing challenges in India’s agricultural sector. We look forward to this collaboration during these critical times and are thrilled to support WayCool’s efforts to enhance food security in India.”
The loan is deployed through IndusInd Bank’s Impact Investing Group. The DFC guarantee enabled the bank to provide an equivalent of Rs. 35 Crores loan to WayCool, IndusInd Bank said in a statement. The structure is significant as it helps in mobilizing local capital for WayCool, also it eliminates foreign exchange rate fluctuation risk from the balance sheet of WayCool, it added.
WayCool procures, processes, and distributes a range of food products including fresh produce, staples, and dairy products, moving over 250 tonnes of food every day to 8,000 enterprise clients across South India. The company operates a soil-to-sale model, engaging deeply with a base of 40,000 farmers in more than 50 regions across India, while bringing efficiency through its direct supply chain model. The Company plans to accelerate profitability and improve on its capital efficient model by continuing to invest in technology and automation across the value chain.
WayCool has previously raised three rounds of funding from Lightbox, LGT Lightstone Aspada, FMO, Caspian Impact Investment, and Northern Arc Capital Ltd.
About U.S. International Development Finance Corporation
U.S. International Development Finance Corporation (DFC) is America’s development bank. DFC partners with the private sector to finance solutions to the most critical challenges facing the developing world today. We invest across sectors including energy, healthcare, critical infrastructure, and technology. DFC also provides financing for small businesses and women entrepreneurs in order to create jobs in emerging markets. DFC investments adhere to high standards and respect the environment, human rights, and worker rights.
About WayCool Foods Pvt. Ltd.
WayCool Foods, founded in July 2015 by Karthik Jayaraman and Sanjay Dasari, is India’s fastest growing agri-tech company. Focusing on food development and distribution, the Company leverages innovative technology to scale and operate a complex supply chain. WayCool operates a full stack, broadline product range across multiple channels and categories such as fresh produce, staples, and dairy, serving over 8,000 clients in the general trade, modern trade, and food services space.
IndusInd Bank, which commenced operations in 1994, caters to the needs of both consumer and corporate customers. Its technology platform supports multi-channel delivery capabilities. As on March 31, 2020, IndusInd Bank has 1911 branches/ banking outlets and 2760 ATMs spread across 751 geographical locations of the country. The Bank also has representative offices in London, Dubai and Abu Dhabi. The Bank believes in driving its business through technology. It enjoys clearing bank status for both major stock exchanges – BSE and NSE – and major commodity exchanges in the country, including MCX, NCDEX and NMCE. IndusInd Bank was included in the NIFTY 50 benchmark index on April 1, 2013.