Announcement of IFC Supports Argentine Industry Fourteen Million US Dollars for Steel Project on November 20, 1975

International Finance Corporation 1818 H Street, N.W. Washington, D.C, 20433, U.S.A. 202-393-6360 IFC Press Release No. 75/22 Thursday, November 20, 1975 for Project The International Finance Corporation (IFC), an affiliate of the W'.::,zld Bank, is lending US$14 million to Dalmine Siderca S.A.I. y C. of Argentina ior a US$133.6 million expansion project. The project involves the construction, at the Company's existing Campana plant site, of an iron ore direct reduction plant and the installation of a fourth electric-arc steel furnace, a continuous mandrel type pipe mill, and auxiliary facilities. It will increase the Company's seamless steel pipe making capacity from 150,000 to 275,000 metric tons a year, increase :steel production capacity, permit it to substitute high-grade Brazilian iron ore for steel scrap, and reduce ~ operating costs. Debt financing of US$102.7 million consists of US$20 million from the Export-Import Bank of the United States (Eximbank); UB$26.9 :million from a con- sortium of commercial banks and the Private Export Funding Corporation, guaranteed by Eximbank; US$22.4 million in Euro-dollar credits provided by a consortium which is managed by Bankers Trust Company, Bank of .America, N.T. and S.A., and Citicorp International Bank Ltd., and which includes First National City Bank, The Fidelity Bank, First Pennsylvania Bank, N.A., and Banco do Brasil, S.A.; US$6.7 million equivalent from Argentine lenders, including the Governmental development bank, Banco Nacional de Desarrollo; US$6.6 million in European suppliers' credits; US$6.l million in loans still to be arranged; and IFC's loan. The Company is increasing its share capital by US$6.2 million equivalent .through share offerings to the Argentine public, which have already been par- tially completed. Cash generation from operations of US$22.6 million equivalent and US$2.l million already spent on the expansion by the Company complete the financing. The expansion supports the Government's efforts to increase domestic ~ steel capacity, will help meet higher seamless steel pipe demand expected to result  - 2 - I from the Government's expanding petroleum development, and will increase the export capacity of the Company. The project will permit more economic utilization of existing·facili- ties and improve the Company's financial results. It is expected to create jobs for 500 workers and produce foreign exchange savings averaging almost US$36 million a year. The IFC investment is its second in Dalmine. In 1969 the Corporation made a US$3 million loan for an expansion project that was completed in 197L, • (Any inquiries strictly relating to IFC's participation in this project should be directed to the IFC Business Relations Unit, 1818 H Street, N.W., Washington, D.C. 20433, Telephone (202) 477-5770) . •