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| AUA - Antigua |
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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 | 27533 |
| Company name | American University of Antigua Limited |
| Country |
| Antigua and Barbuda | (IDA) |
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| Sector | Colleges, Universities, and Professional Schools |
| Environmental category | C |
| Department | Reg Manufact, Agri & Services, CAF/CLA |
| Status | Active |
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| Date SPI disclosed | May 29, 2009 |
| Projected board date | June 28, 2009 |
| Previous Events | Invested: November 25, 2009
Signed: September 25, 2009
Approved: July 2, 2009 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
| American University of Antigua (“AUA” or the “University”) was founded in 2004 in Antigua and Barbuda as a for profit higher education institution which prepares students to practice medicine in the United States. Owned by the Manipal Group (“Manipal”), a global leader in education with operations in Asia, the Middle East, and the Caribbean, AUA currently enrolls over 1,400 students. The proposed project consists of providing long-term financing to support the origination of new loans for AUA students over the next three years (the “Project”). Prior to the global financial crisis, AUA students had been able to directly obtain long-term financing from U.S. private commercial banks. |
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| Project sponsor and major shareholders of project company |
| AUA is 100% owned by Manipal Universal Learning International, Inc. (“MULI”), a Mauritius-based entity which includes all of Manipal Group’s international education operations. Manipal Group (“Manipal”) is a leading Indian player in the education and healthcare markets, providing a wide range of skill-based education (campus and distance-based learning, sector and enterprise-specific courses, and testing and assessment) and medical services (hospital management, clinical and other research). Founded in 1953 by T.M. Pai, the group is still controlled by the Pai family, with independent and investor group representatives active on the board and strong support from professional management. |
| Total project cost and amount and nature of IFC's investment |
| The proposed IFC investment over the next three years is $30 million in the form of an A loan. |
| Location of project and description of site |
| IFC financing will support AUA’s student loan program, which is currently applicable to qualified students participating in AUA’s medical doctor training program and who attend training at the main campus in Antigua and at clinical training sites throughout the United States. The project company is headquartered in Antigua, with certain administrative functions conducted from New York. |
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| Anticipated development impact of the project |
Diversification of Antiguan Economy – Continued attraction of offshore medical students to Antigua is expected to have positive impact on the local economy by supporting in a sustainable fashion: (i) increased tax collections; (ii) development of the island nation’s tourism and other service related industries (property management, catering, construction, etc.); and (iii) employment of local support staff. While Antigua and Barbuda’s small population of 80,000 enjoys a reasonable standard of living, the island nation is susceptible to external factors (lower remittances, reduced tourism revenues, natural disasters) and remains one of the most indebted (as % of GDP) nations in the region.
Support for global medical education – Manipal’s global approach to education provides flexibility in the deployment of medical workers and use of educational infrastructure. AUA’s program fulfills a specific U.S. market requirement, while also potentially reducing the relocation of non-U.S. nationals who might otherwise leave markets also experiencing medical shortages.
Medical and Research Benefits – AUA’s affiliation with the Mount St. John’s teaching hospital in Antigua provides financial and potentially medical support to a medical facility that supports local patient care. In addition, AUA has established, in collaboration with the Antiguan government, the Center for Tropical Diseases, an institution that conducts research on infectious diseases particular to Latin America and the Caribbean, Asia, and Africa. Both types of collaboration support improvement of the health and living condition of the local population. |
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| IFC's expected development contribution |
OECS countries in the region have typically relied on commodities and service industries such as U.S.-linked tourism, while remaining susceptible to external shocks. The project supports a broader development agenda for Antigua (through local employment, student training, student spending) and may address some of the issues being faced in the health arena (e.g. research, presence of specialists). Furthermore, the Project promotes south-south investment, which permits countries such as Antigua to establish new business relations and attract financing sources from extra-regional partners.
For Indian investors such as Manipal, the international expansion provides access to new mature and emerging markets, while providing diversification benefits, as well as a larger platform across which to gain efficiencies of scale. As the Group expands internationally and consolidates its position in a number of emerging markets, such diversification will become increasingly important. Finally, IFC’s combined experience in both the health and education sectors uniquely position IFC to support Manipal’s growth in its two core areas of competency. |
| Environmental and social issues - Category C |
| This project is engaged in financing student loans, and has been classified as a Category C project according to IFC’s Environmental and Social Review Procedure. The project will be required to demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions. No further review is required. The project ompany is required to inform IFC in the event of any change in nature or scope of its contemplated business or operations. |
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| For inquiries about the project, contact: |
Matthew Petersen, Chief Financial Officer
American University of Antigua Ltd.
2 Wall Street
New York, NY 10005 |
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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 |
| Local access of project documentation |
Link available through AUA website: www.auamed.org
Antigua location – Campus bulletin board
U.S. location – Admissions office |
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