Washington, D.C., April 27, 2001The International
Finance Corporation has signed an agreement to lend US$80 million to Arçelik
A.ª., a leading Turkish manufacturer of household appliances. The
IFC loan is intended to support the continued long-term growth and strategic
development of the company.
Khosrow Zamani, Director of IFC’s Southern Europe and Central Asia Department,
said that it is critical for international financial institutions to continue
to support viable private sector enterprises in Turkey at a time when capital
inflows to the country have been greatly reduced, and the local banking
sector embarks on a process of reform. In the midst of anticipated
economic contraction and increased unemployment resulting from structural
reforms, Arçelik’s role as a stable employer and provider of indirect
labor opportunities at the small and medium-sized enterprise level becomes
increasingly important, he added.
The loan package will provide funding for key corporate-wide initiatives
including the modernization of plants, new product development, and information
systems renewal. The company, a member of the Turkish Koç Group,
has demonstrated a strong commitment to continuous reinvestment and product
technology leadership by investing over $300 million in the last five years
for capacity expansion, R&D, and modernization.
In addition, the funding will support diversification of the company through
exports and potential acquisitions overseas. Such investments are
critical in light of competition and cyclical aspects of the industry,
as well as long-term growth opportunities in Turkey and the surrounding
regions. The company’s activities will support foreign currency
earnings, while reinforcing a positive image for quality-based Turkish
IFC will provide a loan for its own account of up to $30 million and total
syndicated loans of at least $50 million for the account of participant
banks. IFC, together with ABN AMRO Bank N.V., are Joint Arrangers
of the syndicated loans for the project, with Citibank N.A. and Crédit
Lyonnais S.A. serving as Co-arrangers. IFC’s involvement has proven
instrumental in mobilizing long-term financing from the international banking
community in the midst of Turkey’s ongoing economic crisis.
The mission of IFC, part of the World Bank Group, is to promote sustainable
private sector investment in developing countries as a way to reduce poverty
and improve people’s lives. IFC finances private sector investments
in emerging markets, mobilizes capital in the international financial markets
and provides technical assistance and advice to governments and businesses.