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Yoma Strategic's Myanmar project nets funding from International Finance Corp
THE World Bank Group's International Finance Corporation (IFC) is taking a stake in a Yoma Strategic Holdings project to power rural communities, the mainboard-listed Yoma Strategic said on Tuesday.
The IFC is set to hold a 30 per cent interest in Yoma Micro Power, a joint-venture company that builds, owns and runs solar- and diesel-powered electricity generators in off-the-grid areas of Myanmar.
The latest investment will raise up to US$28 million through equity and debt financing, supported by Canada's contribution to the IFC-Canada Climate Change Programme.
Yoma Strategic will own a 35 per cent stake, down from its original 47.5 per cent, while Norway's state-owned Norfund - an original partner in the project - will see its interest drop from the initial 47.5 per cent, to 30 per cent.
Project leader and Yoma Micro Power chief executive Alakesh Chetia will hang on to his 5 per cent share of the company.
The project kicked off in 2017 with an initial investment of US$2 million, of which half came from Yoma Strategic.
Part of the initial investment went towards funding a pilot scheme in the Sagaing region of Myanmar, which has since enabled electricity access for 10 telecommunications towers, four villages and some 700 people.
Yoma Strategic CEO Melvyn Pun said in a statement that the pilot's success "demonstrates the reliability of our offering to our partners, and we are eager to roll out quickly to build scale".
His company now aims to provide energy to "hundreds of telecommunications towers and rural communities across Myanmar" in 2018, with as many as 2,000 micro-power plants by 2022.
"Due to the rapid reduction in the cost of solar panels and batteries, solar-powered mini-grids have emerged as a viable alternative for rural electrification which can be deployed rapidly and financed with private capital," said Yoma Micro Power's Mr Chetia.
The IFC country manager for Myanmar, Vikram Kumar, said in a statement: "We believe the business model of Yoma Micro Power presents great opportunity to provide clean and dependable electricity to a large number of rural citizens, with the scale-up of the business approach going forward."