Ljubljana, September 18, 200
6—The International Finance Corporation, the private sector arm of the World Bank Group, agreed to provide €40 million in loan financing to cross-border subsidiaries of Slovenia-based retail company Mercator. Funds will be used to help finance the company’s ongoing investments in Serbia and Bosnia-Herzegovina, which aim to meet increasing demand for high-quality retail services in the region. Mercator’s investment plans include expanding its operations in both countries, part of a broader strategy to become the leading food retailer in Southern Europe. The Mercator project will employ global best industry practices in environmental and social standards and will help create additional jobs through links to customers and suppliers.
The loan is considered the first step of a larger IFC financing package to be arranged in the medium term (targeted for 2007), with syndicate banks pending appetite.
"Mercator demonstrates international best practices for the retail sector, and IFC wants to support its efforts to expand in the Southern Europe region," said Dimitris Tsitsiragos, Director of IFC’s Global Manufacturing and Services Department. "This investment reflects our continued commitment to supporting the private sector in the region with companies that employ high standards and set a good example for other players to follow,” said IFC’s Director for Southern Europe and Central Asia, Shahbaz Mavaddat.
Mercator CEO Ziga Debeljak noted, “IFC’s loan financing will contribute substantially to our investment activities in these markets, which will boost further growth and help us realize a key long-term strategic goal of becoming the leading retailer in the markets of Southeast Europe.”
The International Finance Corporation, the private sector arm of the World Bank Group, is the largest multilateral provider of financing for private enterprise in developing countries. IFC finances private sector investments, mobilizes capital in international financial markets, facilitates trade, helps clients improve social and environmental sustainability, and provides technical assistance and advice to businesses and governments. From its founding in 1956 through FY06, IFC has committed more than $56 billion of its own funds for private sector investments in the developing world and mobilized an additional $25 billion in syndications for 3,531 companies in 140 developing countries. With the support of funding from donors, it has also provided more than $1 billion in technical assistance and advisory services. For more information, visit
www.ifc.org
