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Walton seeks $20m German credit for expansion

B1-Walton20140821131431Electronic goods manufacturer Walton is going to borrow $20m from Germany’s DEG as part of its expansion plan in refrigerator market.

With the loan, the company will increase its fridge production capacity by 500,000 units annually, officials said.

 Under the current capacity, Walton Hi-Tech Industries Ltd is able to manufacture 1m units of refrigerators a year.

On November 13, the company placed a credit proposal seeking loan from DEG before the Board of Investment’s scrutiny committee for approval.  The committee approved the proposal which says the loan will be repaid in seven years with one year grace period.

The interest will be LIBOR+ 4.30% in six months, and “is payable semi-annually in arrears.”

“The loan is being taken for balancing modernisation replacement and expansion of hi-tech fridge factories,” said Uday Hakim, operative director of Walton.

He claimed the Walton now meets 75% of local demand of refrigerators.

The total domestic demand of refrigerators is 1.4m in Bangladesh, he added.

Besides, the company also plans to set up its third hi-tech refrigerators factory as the maker aims to increase local supply during next year’s Eid festivals.

It also wants to produce hi-tech refrigerators for the United States and European markets, increasing the production to 2.4m.

German Investment and Development Corporation (DEG) is a subsidiary of German government-owned development bank KfW.

DEG, one of the largest development financing institutions in Europe, was founded in Cologne in September 1962 as a federally-owned company.

It finances investments of private companies in developing and emerging economies.

As one of Europe’s largest development finance institutions, the corporation promotes private business structures to contribute to sustainable economic growth and improve living conditions in the countries.

Report: Asif Showkat Kallol
Source: Dhaka Tribune

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