Washington D.C., July 1, , 2003—
The International Finance Corporation (IFC), the private sector arm of the World Bank Group, has signed a US$75 million loan as part of a US$216 million refinancing and debt reduction package for Monterrey based Copamex S.A. de C.V.
The debt refinancing will position the manufacturer for future growth and help secure almost 7,000 jobs. Copamex is one of the leading producers and distributors of paper-based consumer products and value-added industrial paper products in Mexico, Nicaragua and Costa Rica.
The IFC financing of US$75 million consists of an eight-year, US$50 million IFC senior loan and a US$25 million quasi equity investment. In addition, IFC will assist Copamex in refinancing US$141 million of its existing debt which will be executed by mobilizing an IFC B loan of up to US$60 million and a Parallel Loan from local lenders for the remainder US$81 million equivalent. IFC will also provide Copamex with a swap of the dollar denominated loans into Mexican Pesos.
The financing package is part of Copamex’s debt reduction and refinancing strategy which will strengthen its financial structure by extending the maturity of its loans and reducing its foreign exchange exposure. A small portion of the financing will assist Copamex with its ongoing modernization program necessary to keep the company in a strong competitive position.
"This restructuring of Copamex’s financial foundation will enable the company to continue operating and prosper during a period when solid Mexican companies are experiencing reduced access to the capital markets. It is a good example of IFC‘s counter-cyclical role in providing long term finance and advice, while keeping commercial banks engaged in the emerging markets,” said Bernard Pasquier, Director of IFC's Latin America and Caribbean Department.
IFC's mission 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, 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 committed portfolio at the end of FY02 was $15.1 billion with an additional $6.5 billion held for participants in loan syndications.
