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IFC Invests $66 million in Chile’s Water and Sanitation Sector - IFC’s first investment in Chile’s water and sanitation sector


In Washington:
Adriana Gomez

Phone: (202) 458 5204

Email:
agomez@ifc.org


Washington, D.C., January 21, 2004. – The International Finance Corporation (IFC), the private sector arm of the World Bank Group, will provide $66 million to Aguas Nuevo Sur, Maule, S.A. (ANSM), the private-sector concessionaire for water and sanitation services in the Maule region in Chile, to carry out its 2002-2007 capital expenditure plan with a total estimated cost of $83.8 million.  ANSM is a wholly-owned subsidiary of RWE Thames Water plc, the world's third largest water company.  

ANSM’s capital expenditure program will primarily consist of the construction of wastewater treatment facilities, the expansion of its sewerage network, and the implementation of operation and maintenance programs for ANSM’s existing networks.  The planned capital expenditure program will result in water, wastewater and wastewater treatment coverage of nearly 100% by the year 2007.  


IFC's investment consists of a $33 million A loan for IFC's own account and a $33 million syndicated B loan for the account of three international financial institutions, ABN AMRO Bank NV, BBVA S.A. and HSBC Bank plc.  This is IFC’s first investment in Chile’s water and sanitation sector.  


Francisco Tourreilles, Director of IFC's Infrastructure Department, said, "IFC’s financing of ANSM capitalizes on its global experience in financing water and sanitation concessions.  With the implementation of its planned capital expenditure program, ANSM will be one of the few water and sanitation concessions in emerging markets to achieve close to 100% water, wastewater and wastewater treatment coverage in its concession area by the year 2007."


Bernard Pasquier, Director of IFC's Latin America and Caribbean Department, noted, "This investment in Chile’s water and sanitation sector demonstrates IFC’s strategy of continued support for private sector participation in infrastructure development in Latin America at a time when many international sponsors are decreasing their exposure to emerging markets.”


Eduardo Verdugo, Managing Director of ANSM, expressed satisfaction at the loan agreement with IFC: "The long-term maturity of the IFC financing, appropriate for a water and sanitation utility like ANSM, will enable us to implement our capital expenditure program and focus on managing ANSM’s operations without worrying about refinancing risk from shorter-term financing sources."


IFC’s mission (
www.ifc.org) is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people's lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses.  Since its founding in 1956, IFC has committed more than $37 billion of its own funds and arranged $22 billion in syndications for 2,990 companies in 140 developing countries. IFC's committed portfolio at the end of FY03 was $16.8 billion with an additional $6.6 billion held for participants in loan syndications.