SEF Konstruksion

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	25323
Company name	Konstruksione Metalike shpk
Country	Albania
Sector	Primary Metals
Environmental category	B
Department	Global Manufacturing & Services
Status	Active

Date SPI disclosed	September 12, 2006
Projected board date	October 13, 2006
Previous Events	Invested: May 11, 2007 Signed: January 22, 2007 Approved: January 22, 2007

View Environmental & Social Review Summary (ESRS), click here

Overview

Sponsor/Cost/Location

Development Impact

Contacts

Attachments

Project description

Konstruksione Metalike, is the largest locally-owned producer of heavy and light steel structures and steel frames in Albania. The company currently imports and customizes locally approximately 2,000 tonnes of steel structures a year. This project involves:

- expanding steel-finishing capacity to approximately 4,000 tonnes of steel structure per year through the construction of a larger site in Vora, an industrial area adjacent to Tirana; and
- purchasing new cutting and welding machinery and transport equipment to sustain the expansion and improve operational efficiencies.

Anticipated development impact of the project

The project contributes to the development and sophistication of Albania’s domestic steel industry, which to date relies heavily on imports of finished steel structures from the region. Konstruksione Metalike is the only domestic company with the ability to cut, weld, paint and finish steel structures in a manner that is directly comparable to finished products imported from other countries. The company is the only one in the country to use AutoCAD-based design technology. As the Albanian construction industry continues to grow and demand for steel rises, Albanians will benefit through the project from larger quantities of affordable and readily available domestic steel structures.

The company employs 65 people, who receive higher salaries than the industry average in Albania. With the proposed project, an estimated additional 40 workers will be hired and properly trained. Development impacts that will be monitored during supervision include the company’s financial performance and transition to higher value-added products.

IFC's expected development contribution

IFC has played an important role in helping small companies, like Konstruksione Metalike, that are leaders in their industry sectors and that have potential for strong growth. IFC has provided technical assistance to such companies through SEED-Albania technical assistance facility, including to Konstruksione Metalike with ISO-2000 trainings. Through this project, IFC is helping complete the project’s financing package with long-term financing and is working closely with the sponsors to help strengthen the company’s corporate governance and environmental practices.

Environmental and social issues - Category B

The project involves the construction and operation of a new workshop and office facilities for a company in the large metal structures business to be located in an industrial zone near Tirana. Based on the site visits and discussions with Konstruksione Metalike management, IFC believes this project will have limited potential adverse environmental and social impacts. Also any impacts will be few in number, site-specific, reversible and easily addressed through agreed mitigation measures. As a result this is a Category B project.

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