48019 - Star Garments Group Togo CMT Expansion

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Summary of Investment Information

Project Number

48019

Company Name

CHARLES KOMAR & SONS, INC.

Date SPI Disclosed

Oct 30, 2023

Country

Togo

Region

Africa

Projected Board Date

Dec 4, 2023

Environmental Category

B - Limited

Status

Active

Last Updated Date

Oct 25, 2025

Department

Regional Industry - MAS Africa

Industry

Manufacturing

Previous Events

Approved : Dec 20, 2023
Signed : Mar 29, 2024
Invested : Sep 30, 2024

Sector

Garment and Apparel (Without Fabric , Excluding Footwear)

Additional Project Attributes

Blended Finance

Project Description

The proposed IFC investment seeks to support Star Garments Group (Private) Limited (“Star Garments” or the “Company”), a Sri Lankan garments manufacturing company and wholly owned subsidiary of Charles Komar & Sons to build a greenfield Cut-Make-Trim (CMT) operation in Togo through a newly formed subsidiary (the Project).

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	7.50
Equity

Development Impact

The project helps finance a Sri-Lanka garments manufacturer to expand its operations in Togo. Economy-wide effects: The Ready-Made Garments (“RMG”) sector in West Africa was badly hit during the onset of the pandemic and it is gradually recovering. Against this backdrop, the Project is expected to have various positive economy-wide effects, including i) domestic and regional value addition, from increased exports through the expansion of the CMT operations; ii) the direct creation of 2,000 formal manufacturing jobs, mostly for women, and a larger number of indirect jobs. These effects will be assessed in detail during the appraisal. Employee effects resulting from training and coaching will also be assessed for their materiality. Contribution to market creation and market competitiveness: The Project is expected to improve the sector competitiveness through the expansion of the CMT operations to achieve scale, and therefore improve the efficiency of apparel production in the West Africa region, including through backward integration (the 2nd phase of the Project). As the first mover in the Togolese market with operations at scale, Star Garments can serve a significant demonstration effect, and support the case for developing the textiles sector in West Africa. This could have significant ripple effects, attracting other investors and players in the region, and permitting the West African textiles sector to follow the trajectory of other successful cases (Bangladesh and Sri Lanka).

Financial additionality – Financing structure: IFC will provide a long-term loan with a sufficient grace period, which is not readily available to the company in the local markets. The loan will be structured to fit the needs of a greenfield apparel project that needs sufficient time for construction and ramp-up. The IDA PSW subordinated loan also gives sufficient cushion to provide the necessary cover for the IFC senior tranche. Non-financial additionality- Standard Setting: IFC will provide technical, Environmental Health, and Safety expertise to improve overall environmental and safety (E&S) performance as well as introduce the international best practice to the client. IFC will also help SGG strengthen the workplace policies for the female workforce (i.e., gender advisory).

E&S Category Rationale / Risks and Mitigation

This is a Category B project according to IFC's Policy on Environment and Social Sustainability (2012). Based on information reviewed by IFC, the proposed Project will have limited adverse E&S impacts that are few, site specific, largely reversible, and readily addressed through existing mitigation measures and good international industry practices (GIIP).

Key E&S risks and issues include: (i) the company’s monitoring and management systems to assess and manage E&S risks and impacts from its operations, as well as those related to the construction of new facility covered under the project; (iii) assurance of fair, safe and healthy working conditions in line with PS2 and legal requirements especially on gender-based violence, freedom of association and workers accommodation; (iii) monitoring and management of air emissions, wastewater, waste and hazardous materials management; (iv) assessment and management of fire safety systems and emergency response for production facilities; (v) supply chain assessment and management of the fabric suppliers (vi) transport and security related community health and safety impacts; and (vii) the company’s stakeholder engagement activities related to E&S aspects.

Contacts

For Inquiries About the Project, Contact

Star Garments Group (Private) Limited
Jeevith Senaratne
Director of Operations
+94 77 350 1864
Jeeviths@star.lk
P.O Box 1, Ring Road 2, Phase 1, IPZ, Katunayake, Sri Lanka
https://www.star.lk

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Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384

Local Access of Project Documentation

Contact Person: Jeevith Seraratne, Director of Operations

Company Name: Star Garments Group (Private) Limited

Address: Star Garments (Pvt.) Ltd, PO Box 1, Ring Road 2, IPZ, Katunayake, Sri Lanka

Email: jeeviths@star.lk

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. Its purpose is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

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