Lagos, Nigeria, July 6, 2010
—IFC, a member of the World Bank Group, announced today that it will invest $12.1 million in Nigerian companies Skye CAPIC and CAPIC Hexagon to develop two hotels in Nigeria, increasing the availability of quality, affordable accommodation and improving the country’s business infrastructure.
IFC will loan $6.6 million to Skye CAPIC, a joint venture between Nigerian private equity fund Capital Alliance Property Investment (CAPIC), and Skye Bank, a publicly listed Nigerian bank. Skye CAPIC will use the funds to build a three-star, 125-room hotel in the Ikeja district of Lagos, Nigeria’s commercial capital.
IFC will also loan $5.5 million to CAPIC Hexagon, a joint venture between Capital Alliance Property Investment and Hexagon Networks, a private local company. CAPIC Hexagon will use the funds to build a three-star, 102-room hotel in Benin City, the capital of Nigeria’s Edo State.
Both hotels will be managed by Protea International, the largest hotel operator in Africa.
Obi Nwogugu, Fund Manager of Capital Alliance Property Investment Company, said, “Partnering with IFC will enable CAPIC to enter Nigeria’s hospitality industry, an important sector as Nigeria’s growing economy attracts more business travelers. CAPIC looks forward to a successful partnership with IFC to help meet the needs of Nigeria’s economy.”
Timothy Oguntayo, Skye Bank’s Executive Director (Investment Banking) said, “Skye Bank has always been known for its strong bias for project finance. We delight in contributing to the development of the real sector of the economy. We have financed various hotels operating under the brand names of Protea, Intercontinental and Merridien Groups. It gives us great pleasure to work with CAPIC and IFC on this project.’’
Omoregbe Erediauwa, Managing Director of Hexagon Networks, said, “Partnering with IFC and CAPIC will strengthen Hexagon Network’s drive towards being a leader in the Nigerian entertainment and hospitality industry. We look forward to a successful partnership.”
Construction of quality hotels in Nigeria has not met demand, and the country’s hotel market features mostly expensive hotels located primarily in Lagos. Only a few international operators exist in the mid-market segment.
IFC’s investments will provide both companies with long-term capital, which has become increasingly unavailable and expensive as many financial institutions have cut back their lending due to recent global financial crisis.
Solomon Adegbie-Quaynor, IFC Country Manager for Nigeria, said, “IFC is committed to investing in a broad range of industries to meet the demands of Nigeria’s growing economy. Through this partnership, CAPIC and IFC will address an important need for affordable, quality business infrastructure in Nigeria, while helping to create jobs in the hotel industry and boosting economic growth.”
IFC, a member of the World Bank Group, creates opportunity for people to escape poverty and improve their lives. We foster sustainable economic growth in developing countries by supporting private sector development, mobilizing private capital, and providing advisory and risk mitigation services to businesses and governments. Our new investments totaled $14.4 billion in fiscal 2009, helping channel capital into developing countries during the financial crisis. For more information, visit