Announcement of IFC Help to Finance Wood Processing Plant in Malawi September 17,1986

"'I' I iStre- N W iional Finance Corporation SA Wednesday, September 17, 1986 CONTACT: Monique Amaudry Press Release No. 87/17 (202) 676-9331 IFC HELPS FINANCE WOOD PROCESSING PLANT IN MALAWI The International Finance Corporation is making an investment equivalent to $3.4 million to help finance the establishment of a $30.4 million plant to produce sawn wood, plywood and blockboard primarily for domestic consumption, by processing abundant domestic forest resources into finished products. The project company, Viphya Plywoods and Allied industries Limited (VIPLY), will be managed by ITMWi international, a newly formed joint venture of Heilborn GmbH, a German private company specialized in technical services and management of projects in the wood working industry, and ITH International, a U.K. based international group, involved in manufacturing, trading and banking in a number of African countries. Equity financing will be provided by IFC (7%), ITMWI (37%), the Investment and Development Bank of Malawi (Indebank) (4%) and Viphya Pulp and Paper Corporation (VIPCOR), a government-owned partner in VIPLY (52%). VIPCOR'S equity is being funded by risk capital funds from the European Investment Bank. - MORE - - 2 - Debt financing will be made by the Government of Malawi, DM38 million (from a financial contribution being made to the Government by the Kreditanstalt fUr Wiederaufbau of Germany), Meridien International Bank Limited, DM5.3 million, IFC DM6.5 million, and Indebank, DMO.8 million equivalent. The plant will be completed by the end of 1988 and is expected to produce 13,000 cubic meters of sawn wood and 15,000 cubic meters of panel products. IFC's six current investments in Malawi amount to $17.8 million in textiles and fibers, food and food processing, chemicals and petrochemicals, development finance, tourism, and money and capital markets. - END -