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IFC TO INVEST IN HIRE-PURCHASE COMPANY IN SENEGAL


Asimina Caminis


WASHINGTON, D.C., Feb. 1 -- The International Finance Corporation (IFC) will invest up to CFAF 90 million (equivalent to about US$160,000 since the recent devaluation of the CFA franc) in Sogeca, a hire-purchase company in Senegal that is increasing its capital base. IFC will also provide the company with a term loan of FF 6 million (US$1 million equivalent). Sogeca, Senegal's only non-bank specialized lender serving small and medium-sized enterprises, plans to expand its services to include leasing finance. CBAO, Senegal's largest indigenous bank and its third largest commercial bank, will hold 32 percent of Sogeca's share capital; IFC and Proparco will each hold 20 percent. The equity stake held by Sogeca's existing shareholders will be diluted to 28 percent of the larger capital base. The technical partner is GIEFCA, a French company that provides management support to West Africa's largest network of leasing companies. Sogeca's expansion will contribute to the development of small and medium-sized industr
ial companies in Senegal, which are currently constrained by the unavailability of term lending. According to IFC officials, IFC was "the driving force behind" the expansion. It structured the financing, identified the partners and brought them to the table, and managed the negotiations. IFC, a member of the World Bank Group, is the largest multilateral source of financing for private sector projects in developing countries. Since 1967 IFC has committed loans and equity investments totaling $56 million for projects in Senegal.