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| NewAuto China |
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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 | 25803 |
| Company name | Newauto Silicon Valley Video Technology Co., Ltd |
| Country | China |
| Sector | Information |
| Environmental category | C |
| Department | Global Inform. & Comm. Tech. |
| Status | Active |
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| Date SPI disclosed | February 21, 2007 |
| Projected board date | March 23, 2007 |
| Previous Events | Invested: January 14, 2008
Signed: September 9, 2007
Approved: July 9, 2007 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
Beijing-based Newauto Video Ltd. (Newauto or company) is one of the largest providers of video technology products and solutions in China. The company provides total solutions and video equipment systems to local broadcasting stations. Newauto provides products such as character generation software, virtual studio and non-linear editing systems. Its customers include over 300 TV broadcasting stations in China.
The Chinese video product and technology market is estimated to be $650 million for 2006. Demand is expected to grow at more than 50% per year in the next 3-5 years, mainly driven by large events such as 2008 Beijing Olympic Games. |
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| Project sponsor and major shareholders of project company |
| Newauto was founded in 1990 by Mr. Zheng Fushuang. The company developed China’s first character generator (1994), first non-linear editing system (1997), and was the first enterprise to be certified for the 3D virtual studio system (2001). Currently, the company is a subsidiary of Newauto Group, a diversified group controlled by Mr. Zheng with interests in IT, media and property management. |
| Total project cost and amount and nature of IFC's investment |
| Newauto is raising $20 million expansion capital and the proceeds will be used for research and development, acquisitions of small local businesses, and establishment of a digital media editing/indexing service arm. IFC is considering participating in this round of financing. |
| Location of project and description of site |
| Newauto has headquarters in Beijing and regional offices in major provinces of China. |
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| Anticipated development impact of the project |
Information technology is an increasingly significant component that underlies the foundation for growth for infrastructure in developing countries. This holds true particularly for China, where growth is fueled by in part by efficient deployment of information technology.
An investment at this stage will allow a local industry leader to expand its range of products and services to measure with its international peers. An investment will support the company’s ability to develop and grow in the domestic broadcasting industry and will assist the local industry to achieve its goals to support the broadcasting industry in its aim to transform to a full digital offering by 2008. |
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| IFC's expected development contribution |
| IFC’s presence will validate and support a young, though high-growth sector in China, while helping the company to use best practices of its international peers. Further, IFC can play a role in enhancing the company’s corporate governance. Finally, IFC’s participation would provide a demonstration effect for high-technology investments in China and other IFC client countries. |
| Environmental and social issues - Category C |
| This is a category C project according to IFC's environmental and social review procedure. There are minimal environmental and social impacts associated with this project. If a new Newauto facility would require land acquisition and/or construction of a building during the life of IFC's investment, Newauto will notify IFC, develop procedures to manage the risks and impacts, and demonstrate to IFC compliance with all relevant environment and social policies, guidelines and procedures. |
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| For inquiries about the project, contact: |
Mr. Zheng Fushuang, Chairman of Board
Newauto Video Technology Company
6th Floor, Silicon Valley Computer City Building
No. 1 Xi Chaochang Road
Haidian District, Beijing China 100080
Telephone: 86-10-62586666
Fax: 86-10-82853152 |
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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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