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Dec. 2000 PACKAGED DEALS


Ludi Joseph, (202) 473-7700, ljoseph@ifc.org Africa & Asia
Jannette Esguerra, (202) 458-5204,
jesguerra@ifc.org Middle East & Latin America
Brigid Janssen, (202) 458-4698,
bjanssen@ifc.org Europe
Lynn Véronneau, (202) 473-6005,
lveronneau@ifc.org General press info


         Washington, D.C., December 8, 2000 —The following is a package of brief announcements about IFC transactions signed in the past month for investments that will support private sector enterprises in the developing world. Packaged Deals is a monthly digest of new IFC investments that have not been announced in our regular press releases. More information is available by contacting the Media Relations team listed at the end.

The mission of IFC, part of the World Bank Group, is to promote private sector investment in developing countries, which will reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, and provides technical assistance and advice to governments and businesses.



CROATIA—PHARMACEUTICALS RESEARCH



IFC is supporting the establishment of the biggest scientific research and development facility in Central and Eastern Europe and promoting widespread use of international laboratory standards with a loan of US$47.5 million to Pliva d.d. in Zagreb, Croatia, the region’s leading pharmaceuticals company.


The $120 million project will consolidate Pliva’s R&D activities in one state of the art facility that will increase efficiency and multi-disciplinary interaction. At the new institute which will open in 2002, all Pliva's R&D activities will comply with international "Good Laboratory Practice" (GLP).  There will be better working conditions for the scientists and the institute will employ about 500 people


Pliva will rely on the enhanced research and development operation to underpin growth and strategic development of the company.  Financing consists of $25 million for IFC's own account, $12.5 million for the account of participant banks, and $10 million in quasi-equity.  Remaining costs for the project to build and equip the R&D institute will come from other multilateral institutions and through Pliva's cash generation.


MOZAMBIQUE—PROCESSING OF WHEAT FLOUR



IFC will provide a $1.3 million guarantee facility to a Mozambican commercial bank to finance construction of a wheat mill by Merec Industries Lda, Maputo, Mozambique.  Merec will expand its factory in the suburb of Machava by adding a mill and storage silos to mill imported grain.  Production is scheduled to begin in January 2001.  The $3.8 million project will create 55 direct jobs, substitute grain imports for flour imports, increase the number of millers, and—through its modern technology and pioneering advisory services to bakeries—enhance the quality of bread available to poor communities in Mozambique.


The sponsors are Merec Financial Corporation and Arrandale Holdings, owned respectively by Mr. Mhamud Charania and his father Mr. Haiderali Ramji.  The company was founded in 1998 and began producing maize meal and copra oil in its Machava factory.  The sponsors also own a distribution company, Africom, which will supply wheat flour to all parts of the country.



NIGERIA—CENTER TO TRAIN FIRE BRIGADE AND SAFETY PERSONNEL



IFC is providing a loan of $500,00 and equity of $80,000 to Safety Center International, in Nigeria to set up the country’s first high standard center to train and certify fire brigade and safety personnel who carry out hazardous assignments.  The $2.2 million SCBA (Self-Contained Breathing Apparatus) center in Port Harcourt will train safety operators in the public and private sectors on the effective use of SCBA to save lives and property, including rescuing victims trapped in fires in buildings, oil rigs, ships, aircraft, and underground mines.  Intertec Engineering Nigeria Limited, Shell Nigeria, and the German Municipal Fire Services College (Landesfeuerwehrschule, Hamburg) collaborated on the development of training courses.


The project sponsor is Intertec Holding Limited (IHL) whose shareholders include local businessmen Prince Oyinlola, Chief Amenechi, H. Enuha, Alhaji Umar, and B. Soyode, as well as German engineer Jobst Kruttke who has worked in Nigeria’s oil and gas sector for over 10 years.  Deutsche Entwicklungshilfe Gesellschaft mbH (DEG) and IFC each have 10 percent equity in Safety Center International.


SOUTH AFRICA—FINANCING AND SERVICES FOR BLACK-OWNED CONSTRUCTION BUSINESSES



IFC will help to fledgling contracting firms by providing financing amounting to $2 million (a loan of $1.9 million and equity of $100,000) to Tusk Project Management (Pty) Ltd., South Africa. Tusk evaluates and administers building contracts and obtains performance guarantees, leaving contractors (usually small black-owned businesses) free to concentrate on construction work, yet becoming familiar with all aspects of project management.  The contracts are to build schools, clinics, low-cost housing, and other public buildings for local authorities.  Tusk makes working capital loans of up to 10 percent of contract value to contractors, monitors raw material procurement, advises on work, and organizes payment claims.



Tusk is owned by its founder and managing director, Hennie de Villiers; Imali Capital (Pty) Ltd., a small venture capital company; Hudgro Investments (Pty) Ltd.; and Mphangwa Selamolela, CEO of the Black Construction Industry Council of the Northern Province.  South African company Brait and IFC will each hold 10 percent equity in the $4.2 million project.



SRI LANKA—IFC SEMINAR ON FINANCIAL SERVICES CONSOLIDATION


A recent IFC seminar on emerging trends in financial services consolidation with IT-based delivery in Bentota, Sri Lanka discussed emerging trends in Sri Lanka’s financial system which is undergoing major changes with increased mergers, consolidations, and hostile takeover attempts.


The seminar addressed issues facing the sector and the role of information technology in the delivery process.  It brought together key regulators, CEOs of banks and financial services companies, and senior professionals with a practical interest in financial market development.  The speakers, who recounted regional and global experiences, guided discussions on how the evolving Sri Lankan market can deal with issues related to consolidations and the role of regulators and technology in improving efficiency and effectiveness.  There were presentations on how more developed markets have dealt with similar challenges.


The seminar complements IFC’s financial markets strategy in Sri Lanka which is aimed at supporting domestic financial institutions and developing long-term debt markets, insurance, pensions, housing finance, and leasing industries.