Kingenta, established in 1998, is listed on the Shenzhen Stock Exchange in China with a market capitalization of about US$3.4 billion in February 2017. Its diversified product profile, including compound fertilizers (CF), slow/controlled release fertilizers (SCRF), nitro-compound fertilizers (NCF), water-soluble fertilizers (WSF) and bio-fertilizers etc, can serve food crops, cash crops and horticulture.

Kingenta is controlled by its founder and Chairman Lianbu WAN, who holds a direct stake of about 18.3% and an additional 39.1% via his controlling over Linyi Kingenta Investment Holding Ltd. Other minority shareholders are mainly financial investors who buy and sell its stocks in the secondary market. 

The Project Company will be incorporated in China with Kingenta directly owning about 40%.

The total project cost is estimated at about US$1 billion. IFC has been asked to consider providing a total financing of up to US$205mn, comprised of both equity and debt. The debt is expected to consist of IFC A loan of up to US$ 100 million and a syndication and mobilization portion of up to US$105 million.

The EHS performances at current manufacturing plants in Kingenta comply with World Bank Group (WBG) EHS Guidelines, and the EHS controls for new upgrade plants will be stricter than the existing plants. Since the manufacturing processes are mainly mixing, formulation, and granulation, water consumption is negligible and there is no wastewater generation expected. Air emissions are well managed and greenhouse gas (GHG) emissions are limited. The application of Kingenta’s special fertilizers will reduce fertilizer consumptions, which will in turn reduce soil/water/air pollutions and reduce GHG emissions from fertilizer manufacturing processes as well as application in the fields and thus the resultant E&S impacts in agriculture sector in China.

The key E&S issues and risks associated with this project include; i) development and implementation of E&S management system for the newly established Jinfeng Agricultural Services Co., Ltd. ii) Pesticide use and management for service center operations; and iii) occupational health/safety management during construction and operation of the project. 

Mitigation measures for the potential E&S impacts have been identified and are incorporated into an Environmental and Social Action Plan (ESAP). The potential adverse E&S impacts of this project are considered few in number, of limited significance and readily mitigated through the sponsor’s existing robust systems and procedures. This is therefore a Category B project according to IFC’s Policy on Environmental and Social Sustainability.