Elemental is a privately owned company established in 2011 and currently majority owned by EFF foundation settled by the Jarski family, with a minority stake being held by Mr. Przemyslaw Krych, a Polish businessman.                                                   

IFC will be investing up to US$90 million in convertible preferred shares of the Company. IFC’s proposed investment is part of a total targeted capital raise of up to US$350 million, in the same instrument. Besides IFC, the Company is currently engaged with other development finance institutions and reputable private investors to secure funding for the private placement.                                                   

The Project involves acquisition of target companies (operating in upstream segment of metals recycling) in emerging and developed markets, and expansion into the downstream segment. The proceeds of IFC’s proposed investment will be used for financing M&A, including a potential acquisition of an existing company in an emerging market, downstream projects and other corporate purposes and transactions.                                                   

The governance risk to development impact is deemed to be low to moderate given that IFC and other investors will be negotiating formalized governance structures, with competent investor nominee director(s) on the board and minority protection rights. Gaps in the Company’s existing Corporate Governance/ESG policies will be addressed through an action plan/ESAP.                                                   

This is a Category B project based on IFC’s 2012 Policy on Environmental and Social Sustainability given that project involves activities with potential limited adverse environmental or social risks and/or impacts that are a few in number, generally site-specific, largely reversible, and readily addressed through mitigation measures.

The key E&S issues and risks associated with this proposed investment include: (i) Elemental’s corporate capacity and systems to consistently manage E&S risks across its subsidiaries in line with IFC’s PSs and the laws and regulations of each country in which it operates; (ii) E&S due diligence and risk mitigation procedures for the corporate M&A program (e.g., historical pollution); (iii) consistent management of labor, working conditions and occupational health and safety (“OHS”) including Covid-19 across all facilities; (iv) fire protection and emergency response organization and management; (v) resource efficiency and GHG; (vi) monitoring and management of air emissions, waste, wastewater and hazardous materials; (vii) community health and safety (H&S); (viii) stakeholder engagement; and (ix) supply chain management.