MEXICO – Proteak Uno, S.A.B. de CV (Proteak) signed an investment agreement for USD 10 million with the Finnish Fund for Industrial Cooperation Ltd. (Finnfund) for the development its MDF Project.

The agreement took shape on 9 October with the first installment of USD 7.6 million by Finnfund to Proteak.

Finnfund is the Finnish development finance institution. Its mandate includes providing venture capital to private long-term projects in emerging markets. Funded projects and companies are chosen according to criteria of sustainability in economic, environmental and social terms. The forestry and energy sectors, two distinct components of the Proteak MDF project, are priority areas for Finnfund. “We are proud to have a partner with such a world-class experience,” said Hector Bonilla, Chairman of Proteak. “The addition of Finnfund to our team once again validates the strength of our MDF project and of Proteak as a reliable partner,” he added.

The Proteak MDF project is being developed in Tabasco, Mexico. The plant was initially conceived to produce 200,000 m3 per year. However, in a highly deficient Mexican MDF market, Proteak decided in August this year to make the necessary adjustments to increase the production capacity of the new MDF plant to 280,000 m3 per year.

Proteak’s new MDF project will require a total investment of USD 200 million. To ensure the supply of raw material, Proteak acquired in September 2013 from Grupo Kuo 8,000 hectares of forest plantations (eucalyptus) for USD 30.6 million. The project will be financed with the company’s own resources and by a loan obtained in January this year of EUR 66.8 MM (USD 91.2 MM) with Ausfuhrkredit-Gesellschaft mbH (AKA) of Germany. The plant is schedule to start operations in the summer of 2015 and its main supplier is Germany’s Dieffenbacher.