WASHINGTON, D.C., June 7 -- The International
Finance Corporation has approved a financing of US$39 million for Fauji
Cement Company Ltd., in Pakistan. The financing involves a US$5 million
equity investment, a US$24 million loan for IFC's own account, and a US$10
million loan, through participations by international financial institutions.
The total project cost is estimated at US$162 million. The project calls
for the construction of a one million tpy greenfield cement plant near
Fatehjung in Northern Pakistan, to meet the needs of the growing domestic
cement market. "The project makes good business sense because that
region of Pakistan is in urgent need of additional cement; the plant has
the advantage of a well-developed infrastructure; and the sponsor - Fauji
Foundation is a financially strong and committed partner." said Andre
Hovaguimian, IFC Director for Central Asia, Middle East and North Africa.
"In addition, the cost structure is fully competitive with the prices
of domestic and imported cement." T
he Fauji Foundation is the largest shareholder in the company, while others
are the Industrialization Fund for Developing Countries (IFU); F.L. Smidth
& Co. (FLS) of Denmark; Nederlandse Financierings-Maatschappij Voor
Ontwikkelingslanden N.V. (FMO); Commonwealth Development Corporation (CDC);
and the National Development Finance Corporation of Pakistan (NDFC). FMO,
CDC and NDFC will also provide the project with loan funds in addition
to Deutsche Investitions-und Entwicklungsgesellschaft mbH (DEG). 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.