Following a $21 million (Sh2.8 billion) investment by the International Finance Corporation (IFC) to support expansion in the two East African nations, Uganda’s Pearl Dairy Farms Limited, owners of the Lato milk brand, is aiming to make an acquisition in Kenya.

The investment would support capacity growth plans in Uganda and Kenya, including the upgrading and capacity expansion of the powder milk factory in Uganda and the purchase of a packing plant in Kenya, according to a report from the World Bank’s private sector investment arm.

The existing Standard Chartered Bank loan for the company in Uganda will be refinanced with an additional investment from the IFC of $14 million (Sh1.87 billion).

“IFC, together with FMO, will provide a $35 million long-term loan package to support the project,” said the IFC.

The Hague, Netherlands-based FMO is a Dutch development bank that is set up as a bilateral private-sector international financial organization.

The Lato brand of UHT milk, powder milk, flavored milk, yogurts, butter, and honey are among the products offered by the Mbarara-based Pearl Dairy. The business serves the majority of East Africa in addition to its home market.

Prons and Cons of Using Milk Vending Machine

Through 80 sales sites in the two operational nations, it obtains milk from over 15,000 farmers (with two thirds in Uganda and one third in Kenya) and distributes it to retailers, wholesalers, and end customers across the continent.

IFC provided the business with a loan of $6.5 million (Sh868.38 million at the current currency rate) to build the state-of-the-art milk processing facility in Uganda.