Announcement of IFC to Invest in Argentine Steel Producer on September 16, 1994

IFC TO INVEST IN ARGENTINE STEEL PRODUCER WASHINGTON, D.C., Sept. 16 -- The International Finance Corporation (IFC) has approved financing of US$45 million for Acindar Industria Argentina de Aceros S.A., the country's largest manufacturer of non-flat steel products. Acindar has an international reputation as one of the industry's leading practitioners of integrated steel production using electric arc furnaces and direct reduced iron. Several of the company's products have been awarded the international quality standard of ISO9002 developed by the International Standards Organization. IFC is providing a US$15 million loan and a US$10 million loan convertible into ordinary shares, both for its own account. The Corporation will also arrange a US$20 million syndicated loan with international commercial banks. As part of its US$110 million investment and restructuring plan, Acindar will consolidate steel melting and rolled/forged product manufacturing at its Villa ConstituciÛn plant, where it will also install new pipe making facilities and upgrade existing rolling mills. The cost savings and productivity improvements from these steps are expected to enhance the company's competitiveness significantly. "With this project, IFC is continuing to support the restructuring of the Argentine steel sector and is helping Acindar maintain its strong market position in the face of increased competition in the Mercosur and world markets," according to Mr. Helmut Paul, Director of IFC's Latin America and the Caribbean Department. "It also reflects IFC's strategy in Latin America to assist industrial restructuring by enhancing companies' access to long-term funds from the international syndicated loan market." IFC is a member of the World Bank Group and is the largest multilateral source of equity and loan financing for private sector projects in developing countries. IBRD IDA IFC MIGA ICSID