MTI signs term sheet with AFIC to launch joint venture company for grading raw rice bran using state-of-the-art agriculture machinery

MTI SIGNS TERM SHEET WITH AFIC TO LAUNCH JOINT VENTURE COMPANY FOR GRADING RAW RICE BRAN USING STATE-OF-THE-ART AGRICULTURE MACHINERY

Despite being a major rice-growing region, Africa's rice bran industry has not reached its full potential due to inadequate processing facilities. The demand for rice bran products is expected to grow rapidly in the coming years, driven by consumer demand for natural and healthy food products and the increasing demand for animal feed ingredients. TANSWED will pioneer agricultural automation in the rice bran sieving industry in Tanzania, providing infrastructure for rice bran traders to obtain higher prices for their products in domestic and international markets.

MTI's investment of approximately SEK 350,000 will fund the establishment of a modern rice bran processing plant, where raw rice bran will be processed to graded quality, with broken rice separated, and rice husk ground. Rice grains consist of two protective outer layers: husk and bran. During the milling process, these layers are usually removed. While husk provides little nutritional value, bran is a valuable source of dietary fiber, essential fatty acids, starch, proteins, vitamins, and dietary minerals.

The investment will diversify MTI's industry exposure into the agro-processing sector, strengthening its presence in Tanzania. MTI will own a 49% stake in TANSWED, aligning with Tanzania's National Development Vision 2025 to leverage the country's abundant natural resources, including agriculture, to grow its gross domestic product. The investment is expected to be concluded before 30 march 2023.

AFIC's Director Michael Mrosso says: "We are delighted to establish a joint venture with impact investor MTI. We are a leader in trading agro products and as such we know that there is a huge demand for mechanized rice bran processing. The rice bran industry in Africa holds great promise, but significant investments are needed to unlock its full potential. MTI's expertise in venture building and ability to provide growth funding will allow us to scale fast and profitably."  

Speaking about the investment, MTI Investment's CEO Pontus Engström said, "We are excited to announce this new investment in Tanzania's rice bran-processing industry. We believe that this investment will be a game changer for the industry and create an infrastructure for rice bran traders to get their products graded and fetch higher prices in domestic and international markets. Moreover, we are looking forward to working with AFIC, who possess extensive industry experience. Our investment will make an impact on the quality of rice bran traded and will significantly contribute to UN Sustainable Development Goals. Growth in Tanzania's agricultural sector is being hampered by a lack of cutting-edge agricultural machinery. We are proud to be alleviating this bottleneck with this impact investment that is likely to generate substantial financial returns while also creating a positive social and environmental impact."

For additional information
Pontus Engström, CEO, MTI Investment SE
[email protected]
+46 70 716 55 38

The following documents can be retrieved from beQuoted
ENG-AFIC-MTI-Investment 060323.pdf