Announcement of IFC Investment in Pro-Hoteles S.A., Colombia on May 20, 1970

~ FOR IMMEDIATE RELEA~ ~'~ :\._T'NTERN.ATIONAL FINANCE CORPORATION 4,a H STREET. N.W., WASHINGTON D. C. 20433 TELEPHONE: EXECUTIVE 3-6360 IFC News Release No. 70/12 SUBJECT: IFC Investment in Pro-Hoteles Nay 20, 1970 S .A., Colombia _/ The'International Finance Corporation, of the World Bank Group, is joining a broad group of Colombian investors and two United States organizations to finance Pro-Hoteles S.A., which is building a 255-room, first class business and tourist hotel in Cali to cost approximately $4.1 million equivalent. The new Cali hotel is scheduled for completion in time for the Pan American Gamesj to be held in Cali in July 1971. It will help relieve a shortage of accommo- dations in the city and serve as a link in the nationwide chain of first class hotels which is being developed to encourage the tourism industry. The hotel will employ appr·oximately 300 Colombians. It is expected to result • in foreign exchange earnings of about $500,000 anny' )l.y • Over $1 million equivalent in equity is being supplied by Colombian investors. Approximately $340,000 equivalent will be provided through a public share offering in Colombia. This will be underwritten by two Colombian development fi- nance companies, Corporacion Financiera Colombiana and Corporacion Financiera del Valle. The balance of the Colombian equity financing, $750,000, is being provided by two Government sponsored institutions, the Organizing Committee for the Pan American Games and the Instituto de Fomento Industrial (IFI); Corporacion Finat,biera Colombiana and Corporacion Financiera del Valle; a group of Cali businessmen and corporations, several of whom were instrumental in organizing the venture; Avianca, the principal Colombian airline; Cuellar, Serrano, Gomez y Cia. Ltda.; and Sidgo, Koppers Colombiana. (more) t ,,. IFC News Release No. 70/12 -- Colombia '-Ji - 2 - Intercontinental Hotels Corporation, a Pan American World Airways subsidiary, is investing approximately $380,000 equivalent, making it the largest shareholder, with more than 20 per cent of the equity. Intercontinental Hotels is the technical sponsor and will assist in the construction of the hotel and will operate it. IFC 9 S commitment consists of approximately $210,000 equivalent in equity, an $800,000 loan, and approximately $35,000 equivalent for contingencies. IFC's co1Ilillit- ment results from a suggestion by Hoturismoj a Colombian tourism industry promotion company, which IFC helped establish a little over a year ago. The Organizing Committee is J.ending approximately $270 9 000 equivalent. The U.So Export-Import Bank is lending up to $250,000 to the project and the two Colombian development finance companies, together, are lending $250,000o They are • also joining IF'I in lending an additional $820,000 equivalent. With the Cali Hotel project, IFC will have made 35 commitments amounting to approximately $19. 7 million in 18 Colombian projects. The projects had total costs of approximately $144 million, and we,r:e in the fields of electrical equipment, fiberboard, food products, home furnishings, livestock, metal cans, steel forging, textiles, tourism, warehousing, and development finance companies. II II II