NatureBank Signs Agreement of Limited Partnership to Invest Over $14 Million in Sustainable Cocoa Development
May 5, 2017, Vancouver, British Columbia: NatureBank Asset Management Inc. (“NatureBank” or the “Company”) (TSX-V: COO, Frankfurt: 9EA) is pleased to announce that it has signed an Agreement of Limited Partnership (the “LP”) with Southern Harvest Partners LP (“SHP”) and related entities, for the development and ongoing management of a portfolio of both operating cocoa projects and new, undeveloped cocoa projects (the “Project”), through its fully owned Swiss subsidiary, Nature Ventures GmbH (collectively with SHP and related entities, the “Partnership”). This LP agreement follows the announcement of the signing of a non-binding MOU, which was publicized in a June 1, 2016 press release.
Under the terms of the LP, the Partnership will develop a portfolio of highly productive operating and greenfield cocoa projects growing fine and flavor cocoa in the Dominican Republic, with the objective of cultivating, processing and marketing cacao and its derivative products to meet the growing demand for sustainable cocoa in the international marketplace.
In addition to the LP agreement, NatureBank’s wholly owned subsidiary Forest Finest Consulting GmbH (“FFC”) has entered into an exclusive three (3) year Management Agreement (the “Agreement”) with the LP. Under the terms of the Agreement, FFC’s leading technical team of sustainable cocoa agro-forestry experts will be responsible for all aspects of cacao project development, from identification, evaluation and acquisition of cacao opportunities, to the establishment and implementation of development plans to the offtake and sales agreements of end products. FFC will be compensated by the LP to provide these services.
“We are excited to be moving forward with cacao developments in the Dominican,” stated Robert Decosimo, Board Member of the Limited Partnership. “Sustainable cacao in the Dominican Republic provides a compelling investment opportunity for the Partnership, and we look forward to its long term success.”
The in-country work in the Dominican Republic has progressed significantly since the signing of the original MOU in 2016. The LP is now in a position to complete its initial land acquisitions within the country and establish the required nurseries, having already assembled the local operating companies and management team. First plantings are expected by Q3, 2017.
“We are very pleased to partner on this significant cacao development,” commented Phil Cull, Co-CEO of Naturebank. “The agriculture investment experience and long term vision of the members in the Partnership provide an excellent foundation for us to establish a leading sustainable cacao business for decades to come.”
Cocoa and the Dominican Republic
Cocoa agriculture is valued at more than $8 billion annually, yet the global cocoa supply chain is fraught with multiple economic, social and environmental challenges, presenting a difficult situation for the sector. Challenges in production include the availability of productive land, deforestation concerns, pesticide/chemical use, the availability of trained workers, child labour practices, local climate and soil conditions, access to modern and appropriate agronomy techniques, production costs, processing, transportation and export costs among others. In response to these challenges, many of the world’s leading chocolate producers have committed to sourcing only sustainably grown and managed cocoa from suppliers within the next decade.
As sustainable cocoa experts, NatureBank has focused on the Dominican Republic, a country that has long embraced sustainable cocoa production, evidenced by being the largest producer of organic cocoa in the world. It is also a leading producer of fine or flavor cocoa, which is priced at the premium end of the cocoa market. As the 8th largest cocoa country, the Dominican has a number of advantages which NatureBank and the Partnership find attractive. Beyond excellent soil and weather conditions, the Dominican has a low rate of crop disease due to seasonality, while being absent of certain prevalent diseases found elsewhere. There is an availability of suitable greenfield land in the Dominican that can be developed into productive agro-forests, in an environmentally sustainable fashion, ensuring deforestation does not coincide with agriculture. The country has well developed existing infrastructure, and qualified, experienced farmers and technicians. Additionally, there is political and economic stability with solid GDP growth and an overall attractive business climate.
NatureBank Asset Management Inc.
About NatureBank Asset Management Inc.
NatureBank specializes in advisory, technology and project investment services applied to sustainable commodities and ecological assets, with a primary focus on cocoa, timber and carbon. We provide our customers with a multidisciplinary approach to investing, managing risk, enhancing asset performance and securing commercial returns. While managing climate change risk, we improve livelihoods and sustainability in project regions. Through our advisory services team and our subsidiary companies, Offsetters and CO2OL, we help organizations understand, reduce and offset their climate impact. With offices in Vancouver, British Columbia; Portland, Oregon; Zurich, Switzerland and Bonn, Germany, our team has a global reach. Our team has worked with over 200 leading business organizations including Aimia, Vancity, lululemon athletica, Catalyst Paper, Harbour Air, HSE - Entega, and Shell Canada Limited. NatureBank is publicly listed company on the Toronto Venture Exchange (TSX-V:COO) and in Frankfurt:9EA. Please visit us at www.NatureBank.com.
For further information, please contact:
NatureBank Asset Management Inc.
Suite 1000 - 675 West Hastings Street,
Vancouver BC, V6B 1M8
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