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IFC APPROVES DM 63 MILLION FOR CZECH WHEEL MAKER


Jeanne Segal


WASHINGTON, D.C., Nov. 16 -- The International Finance Corporation (IFC) has approved financing of DM 63 million for Autokola Nova Hut a.s. (Autokola), an automotive wheel maker in the Czech Republic.

The financing, announced today at a press conference in Prague, consists of a DM 27 million investment for IFC's own account and a DM 36 million loan that has been syndicated with seven European and American banks. The total project cost is estimated at DM 104 million.


Autokola is a joint venture company established in 1992 between Nova Hut a.s. Ostrava (NHO), a Czech steel producer, and Hayes Wheels International Inc. (HWI), a U.S.-based company that is the world's leading producer of automotive wheels. At present Autokola is the only independent automotive wheel producer in Central Europe, and its customer base includes Skoda and Tatra in the Czech Republic.


"Autokola merits IFC's support because it provides the Czech Republic with a high quality, low cost producer in the competitive European automotive components industry," said Mr. Wilfried Kaffenberger, IFC Vice President for Operations.


"With IFC's assistance Autokola will expand its annual production capacity from the current level of 1.5 million car wheels to 4.5 million. The company has already installed a new paint facility and will add two additional assembly lines," said Mr. William Shovers, Vice President Finance of Hayes Wheels.


The participants of the syndication are the ABN AMRO Bank N.V., Chase Manhattan Bank, N.A., Comerica Bank, Creditanstalt-Bankverein, Dresdner Bank Luxembourg S.A., ING Bank N.V., and NBD Bank N.A. "The syndication was oversubscribed, showing the confidence of the financial community in the Czech Republic and in the viability of this project," said Francis Hamilton, IFC Head of Syndications.


IFC, a member of the World Bank Group, is the largest multilateral source of direct loan and equity financing for private sector projects in developing countries.

Autokola