Announcement of Major Mexican Cement Project Two Hundred and One Million US Dollars Tolteca Expansion on December 7, 1978

International Finance Corporation • 1818 H Street, N.W. Washington, D.C. 20433. !JS.A 202-393-6360 IFC Press Release No. 79/19 Thursday, December 7, 1978 Major Mexican Cement Project $201 Million Tolteca Expansion The largest expansion of Mexico's cement industry in five years is being m1dertaken by Empresas Tolteca de Mexico, S.A., with a $201 million project to increase the Company's production capacity by 2.2 million metric tons a year from its current level of 3.4 million tons a year. The project includes construction of a new, one million tons-a-year cement plant at Hermosillo in northwest Mexico, expansion and modernization of six of Tolteca's existing eight cement mills, and improvement of its ready-mix facili- ties. • The International Finance Corporation (IFC), with the participation of a group of British, Canadian and United States financial institutions headed by Libra Bank Limited and Bank of America, N.T. & S.A., is lending $100 million for the project the largest financing ever undertaken by IFC. IFC will retain $15 million in loan for its own account with $85 million in participations being sold to: Libra Bank Limited, Bank of America, N.T. & S.A., Bank of Montreal, Chase Manhattan Bank, N.A., Citibank, N.A., The First National Bank of Bostons National Westminster Bank Group, Security Pacific National Bank, Midland Bank Limited, Canadian American Bank, Canadian Imperial Bank of Conunerce, International Mexican Bank Limited, Wells Fargo Bank, N.A., and Samuel Montagu and Co. Limited. The remainder of project costs will be met by a $17.4 million debenture issue in Mexico, Mexican bank loans of $9 million, suppliers' credits, and the Company's cash generation. Tolteca is majority Mexican owned and its shares are traded on the Mexico City stock exchange. Blue Circle Industries, Britain's largest cement company and one of the world's leading producers, is a major shareholder and technical • partner. Blue Circle Industries is providing Tolteca with technical and engi- neering services as well as with specialists to assist in project implementa- tion.  - 2 - Bernardo Quintana, head of the Mexican majority shareholders and President of the Board of Directors, explained that with this investment Tolteca honors its commitment in the Alliance for Production convened by • Mexican President Lopez Portillo at the beginning of his term. In this agreement, the cement industry offered to make large investments to :!.ncrease production, satisfy demand and provide a stimulus to the Nation's economy. "The demand for cement," Quintana added, "has increased markedly in our country, a clear indication of the economic recovery taking place, thanks to the climate of confidence established. Cement is the first commodity to be consumed when economic activity recovers." "Tolteca's expansion," he concluded, "is aimed at guaranteeing the supply of cement in a rapidly developing cotmtry such as ours which in the coming years will experience an accelerated rate of economic activity." • (Any inquiries strictly relating to IFC's participation in this project should • be directed to the IFC Information Office, 1818 H Street, N.W., Washington, D.C. 20433, Telephone (202) 477-5340.)