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| Telecel III |
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| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 24671 |
| Company name | Telefonica Celular de Bolivia S.A. |
| Country | Bolivia |
| Sector | Information |
| Environmental category | C |
| Department | Global Inform. & Comm. Tech. |
| Status | Pending Disbursement |
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| Date SPI disclosed | October 17, 2007 |
| Projected board date | November 30, 2007 |
| Previous Events | Signed: March 18, 2008
Approved: February 13, 2008 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
| The project consists of the upgrade and nationwide expansion of Telefónica Celular de Bolivia S.A.’s (Telecel or the company) GSM network in Bolivia. Telecel is a current IFC client. The project is expected to increase the quality of telecommunication services in Bolivia as well as extend access and services to additional parts of the country. |
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| Project sponsor and major shareholders of project company |
| Telecel is a wholly-owned subsidiary of Millicom International Cellular S.A (Millicom). Founded in 1990, Millicom is a BB rated (S&P) global cellular telecom operator with about 20 million customers in 16 emerging market countries. Millicom is based in Luxembourg and is listed on NASDAQ and in Stockholm. |
| Total project cost and amount and nature of IFC's investment |
| The project financing requirements are estimated to be about $70 million of which IFC has been approached to provide up to $30 million in the form of a senior loan. The remaining $40 million will be financed by other IFIs (FMO, Standard Bank and Nordea). |
| Location of project and description of site |
| Telecel is headquartered in Santa Cruz, Bolivia which operations and services throughout the country. Financing will be used to fund the upgrade and expansion of the network in sites throughout Bolivia. |
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| Anticipated development impact of the project |
| The project is expected to increase access to telecommunication services in the country, including rural and underserved areas. Upgrading the remaining TDMA network to GSM will improve the quality of telecommunication services as well as reduce costs, including the availability of a wider base of cheaper handsets. The project is expected to lead to job creation in the sector, as well as in related sectors, including generating employment in rural and semi-rural areas. Additionally, the project will spur competition in the sector, leading to improved services and benefits to Bolivian consumers. |
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| IFC's expected development contribution |
| IFC is supporting the growth and expansion of an existing client. It is helping fund a sizeable project in one of the poorest countries in South America where financing is otherwise limited. |
| Environmental and social issues - Category C |
| This is a Category C project according to IFC's environmental and social review procedure, based on IFC's long-term relationship with the sponsor, and because there are limited environmental and social impacts which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. Under IFC's previous investments with Telecel, the Company has been required to develop and implement an environmental/social management system (ESMS) and submit to IFC environmental/social Annual Monitoring Reports (AMRs), which it has done to IFC's satisfaction. For this project, a review was performed of environmental and social issues in light of IFC’s Performance Standards, which will apply to Telecel for the first time under this new investment. While there are no significant new impacts, Telecel will update it ESMS as needed to ensure it is consistent with IFC’s Performance Standards, and continue to provide AMRs to IFC. |
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| For inquiries about the project, contact: |
Peter Lewis,
Treasurer & Head of Corporate Finance,
Millicom S.A.
15 rue Leon Laval
L-3372 Leudelange
Luxembourg
+352 27 759 247 (Office)
+352 691 751 254 (Mobile)
+352 27 759 360 (Fax)
Ignacio Baratelli,
Executive Vice President/ CEO
Telecel S.A.
Av. Viedma # 648
Santa Cruz, Bolivia
+591 77390000 (Office)
+591 3 3365002 (Fax) |
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| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
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