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| Mi Tienda |
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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 | 28587 |
| Company name | Sistema Integral de Abasto Rural S.A.P.I de C.V |
| Country |
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| Sector | Retail (Including Supermarkets, Grocery Stores, etc.) |
| Environmental category | B |
| Department | Reg Manufact, Agri & Services, CAF/CLA |
| Status | Active |
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| Date SPI disclosed | October 28, 2009 |
| Projected board date | November 30, 2009 |
| Previous Events | Invested: March 24, 2011
Signed: January 19, 2010
Approved: January 14, 2010 |
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| View Environmental & Social Review Summary (ESRS), click here |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
MiTienda (“the Company” or “MiTienda”) is a privately-held company engaged in the rural distribution of food and other basic products in Mexico. The Company was founded in 1999 and started operations in Atlacomulco (Central Mexico) as a single pilot cell (a distribution center). It offers non-perishable food and personal care distribution to approximately 600 stores located in rural zones (towns with less than 5,000 inhabitants). The project consists in the expansion of the pilot cell through the development of 36 cells that will target 4.8 million households in 602 municipalities and 14,740 villages, with an expected investment initially estimated at MXP $209 million (US$16.1 million).
MiTienda offers modernization programs to its customers, which will contribute to increasing sales and efficiency. MiTienda will also implement an affiliation program to modernized stores and it will use its brand name to promote a certain level of quality offered by the stores. |
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| Project sponsor and major shareholders of project company |
| Jose Ignacio Avalos Hernandez (the “Sponsor” or Mr. “Avalos”) is one of the original founders of Compartamos, an IFC client and one of the most successful microfinance banks in the world. Mr. Avalos has approached IFC for participating in this investment as he sees a strong role and additionality in having IFC involved in this Project. |
| Total project cost and amount and nature of IFC's investment |
| The total project cost is estimated at MXP 209 million It is proposed that IFC finance up to15.5% of the Project with an equity participation of up to MXP 32.5 million (up to US$ 2.5 million). |
| Location of project and description of site |
| The Company started operations in Atlacomulco, Estado de Mexico (a half hours drive from Mexico City). Mi Tienda plans to open 36 additional cells distributed throughout the Central-South region of the country. The next cell will be opened in the city of Tepeji, which is one of the 84 municipalities of Hidalgo. |
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| Anticipated development impact of the project |
The Project will have a strong development impact by:
• Securing regular supply of key basic products in MiTienda’s zone of influence, which is currently excluded from the formal retail supply chain
• Supporting the development of small businesses in rural areas through MiTienda’s training and modernization programs.
• Increasing the offering and diversity of products at competitive prices for the rural population.
• Enhancing access to credit to the stores who purchase from Mi Tienda. |
| IFC's expected development contribution |
IFC will provide long term equity financing to support the Company’s expansion program in remote parts of the country.
• Anchor Investor: IFC’s involvement and participation is expected to have an anchor effect in attracting the necessary capital to develop the project.
• Stamp of Approval: Project Sponsor is seeking IFC’s involvement as a long term partner in the promotion and the replication of the project in other geographies.
• Best practices: IFC will introduce environmental, social and industry best practices. |
| Environmental and social issues - Category B |
This is a category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result that can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
Key environmental and social issues identified during the appraisal include the following:
• Environmental and social management capacity during the expansion of the company
• Labor and working conditions
• Air emissions from the fleet
• Life and fire safety in the distribution centers, and
• Solid waste management, including expired/damaged products
The project is expected to have positive social outcomes, in particular by supporting and training entrepreneurs in Mexico, mainly women who owns the stores.
Please refer to the Environmental and Social Review Summary (ESRS) for further information. |
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| For inquiries about the project, contact: |
Mr. Valentin Martinez Gama Z., CEO
Reforma 1110
Lomas de Chapultepec
México D.F. 11000
México
Tel: + 52 55 55 40 72 22
Fax: + 52 55 55 40 72 21 ext. 15 |
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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 |
Translated versions of the ESRS and the EAP will be available at
MiTienda
Adolfo López Mateo S/N
Col. Fovisste
Atlacomulco, Estado de Mexico, C.P. 50450
Contact Person: Alberto Gutierrez |
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