Washington, D.C., July 18, 2005 —The
International Finance Corporation, the private sector arm of the World
Bank Group, has signed an agreement to provide $35 million in long-term
financing to Coppel, S.A. de C.V., one of Mexico’s leading retailers.
IFC’s 10-year financing will support Coppel’s expansion plans: the company
will consolidate as a national chain, enhance its credit business, and
strengthen its corporate governance standards. The financing will also
endorse Coppel’s $195.3 million strategic capital expenditure plans for
the next three years. This is IFC’s second financing to Coppel, which
received $30 million in 2002.
Coppel is a successful retail chain, with more than 250 stores in Mexico
serving low- and middle-income segments of the population. Coppel sells
a large range of merchandise and offers an efficient direct credit program,
with extended payment periods, for people who have no access to credit
cards or other financial aid. Coppel is listed on the Mexican stock market.
“This second financing in Coppel shows IFC’s commitment as a long-term
partner. It also demonstrates our confidence in the company’s prospects,
thus sending a positive signal to other potential lenders,” said Dimitris
Tsitsiragos, IFC’s Director for General Manufacturing and Services.
Atul Mehta, IFC’s Director for Latin America and the Caribbean, noted
that, “This financing is consistent with IFC’s strategy of helping the
Mexican private sector gain greater access to long-term financing, thus
helping local companies grow, improve their competitiveness, and create
Enrique Coppel, Chief Executive Officer of Coppel, added: “We value IFC’s
commitment as a long-term partner and its ability to respond to the needs
of its clients in a timely fashion. Medium-sized retailing companies
in Mexico have limited access to long-term finance, and working with IFC
will give Coppel the opportunity to continue investing in our operations.
Since our strategy is to expand operations nationwide, access to long-term
funding is critical at this stage of the company’s growth.”
Mexico’s achievement of full investment grade in 2002 has facilitated
the country’s access to capital, especially as regional markets have recovered
from mid-2003 onward. This has allowed IFC to take a focused approach to
the country’s development, targeting the sectors where investments can
have the biggest economic and social impact.
In the fiscal year that ended in June 2004, Mexico was the country receiving
the largest amount of IFC financing in dollar value. IFC invested a total
of $707 million, including $259 million in syndications, in sectors ranging
from infrastructure to manufacturing and the financial sector. IFC’s
total portfolio in Mexico was $833 million as of March 2005.
The mission of IFC (www.ifc.org)
is to promote sustainable private
sector investment in transition economies, helping to reduce poverty and
improve people's lives. IFC finances private sector investments in the
emerging markets, 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 FY04, IFC has committed more than $44 billion
of its own funds and arranged $23 billion in syndications for 3,143 companies
in 140 developing countries. IFC’s worldwide committed portfolio as of
FY04 was $17.9 billion for its own account and $5.5 billion held for participants
in loan syndications.