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IFC Invests $70 Million in Andrade Gutierrez Group in Brazil


In Washington, DC:
Adriana Gomez

Phone: +202 458 5204 /Fax: +202 974 4384

Email:
agomez@ifc.org

Desmond Dodd

Telephone: +202 473 7194 /Fax: +202 974 4384


Email:
ddodd@ifc.org


Washington, D.C., May 20, 2003—The International Finance Corporation, the private sector arm of the World Bank Group, arranged a $70 million investment to support the financial operations of the Andrade Gutierrez Group, one of Brazil's premier industrial groups. AG has engineering and construction operations, and telecommunications and infrastructure concessions.  IFC supported AG's concession arm in 2001 and has extended support to the central holding company.  

IFC's financing, with a final maturity of seven years, includes a loan for its own account of up to $30 million, and a syndicated loan of up to $30 million for participant banks. IFC is also providing a convertible loan of $10 million.  


“The investment in the Andrade Gutierrez Group demonstrates IFC’s continued support of one of the leading Brazilian infrastructure groups.  IFC’s financing package will allow AG to pursue long-term growth and better governance to create a stronger company for the future,” said Francisco Tourreilles, IFC director of Infrastructure.  “IFC is providing long-term financing for its own account in a market where such financing continues to be scarce,” he added.


Mr. Sergio Andrade, President of Andrade Gutierrez, said, "This long-term financing package will improve the group's ability to make new investments while improving overall performance. By implementing IFC environmental policies, AG has brought competitive advantages to its group companies.”


Andrade Gutierrez, founded in 1948 in the Brazilian State of Minas Gerais, brings state-of-the-art project management and engineering to large scale projects in the energy and public infrastructure sectors.  AG is one of the largest Brazilian private sector conglomerates by revenues and one of Brazil's leading service exporters.  AG is a diversified group operating principally in Latin America and Portugal.


IFC has worked actively to support the development of a sustainable private sector in Brazil.  With a $1.23 billion portfolio, Brazil is the largest IFC client in Latin America and worldwide. In 2002, IFC played a critical role in providing much-needed long-term finance to Brazilian enterprises, and in supporting trade finance facilities for export companies. At that time flows of international capital had declined and economic growth was slow. These trade facilities showed IFC’s ability to adapt to the needs of its clients.  IFC’s investment in Andrade Gutierrez demonstrates the Corporation’s continued commitment to support local companies that remain dedicated to investing in the infrastructure sector in Brazil.  


The mission of IFC 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 through FY02, IFC has committed more than $34 billion of its own funds and arranged $21 billion in syndications for 2,825 companies in 140 developing countries. IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its own account and $6.5 billion held for participants in loan syndications.