Tirana, Albania/Washington DC, October 28,
2003.- The EBRD and International Finance Corporation (IFC) are each
acquiring a 19.5 percent stake in Albania’s largest insurance company,
Instituti I Sigurimeve SH.A. (INSIG) to support its privatization.
The combined LEK 1.25 billion (€9.4 million) stake is the first of two
major steps towards privatizing the company. The second, involving the
sale of at least a 51 per cent stake to a strategic investor, through an
international tender, with up to 9 per cent offered to the public, is expected
to take place next year. The Central European Initiative is providing
€500,000 in technical assistance that will support a significant transfer
of insurance technology to the company and train its staff.
Kastriot Islami, Minister of Finance for Albania, said having IFC and the
EBRD involved in the privatization process will promote the sale of INSIG
in an open and transparent manner. By committing to improving the business
climate, Albania hopes to attract more foreign investment, Mr. Islami added.
In addition to supporting the privatization of a key Albanian company,
the project will promote the development of the insurance sector in Kosovo,
where INSIG also operates.
Khosrow Zamani, IFC’s Director for Southern Europe and Central Asia, noted:
“This landmark operation will strengthen INSIG by improving its corporate
governance, policies and procedures and will make it more attractive to
potential strategic investors. It will also help restore confidence in
the Albanian insurance system, enhance industry standards and competition
in the local insurance sector.”
Kurt Geiger, Business Group Director for Financial Institutions at the
EBRD, said the investment is important because it will strengthen both
the company – ahead of its full privatization – and the country’s under-developed
insurance sector. As well as increasing the range of products offered in
Albania, the project will prepare for and encourage the privatization of
other businesses in the country, Mr. Geiger added.
The mission of IFC (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.
From its founding in 1956 through FY03, 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 worldwide committed portfolio
as of FY02 was $16.7 billion for its own account and $6.6 billion held
for participants in loan syndications.
The EBRD, owned by 60 governments and two intergovernmental institutions,
aims to foster the transition from centrally planned to market economies
in central and eastern Europe and the Commonwealth of Independent States.
Visit the EBRD’s website: www.ebrd.com