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| Summary of Project Information (SPI) |
| This Summary of Project Information 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. |
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| Project number | 24454 |
| Project name | TDD-Expansion |
| Country | Turkey |
| Sector | Industrial & Consumer Products |
| Department | Global Manufacturing & Services |
| Company name | Turk Demir Dokum Fabriklari A.S. |
| Environmental category | B |
| Date SPI disclosed | November 18, 2005 |
| Projected board date | December 23, 2005 |
| Status | Completed |
| Previous Events | Invested: April 12, 2006
Signed: March 17, 2006
Approved: February 22, 2006 |
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| Description of company and purpose of project |
Turk Demir Dokum Fabrikalari A.S. (TDD or the Company) is a leading producer of heating appliances in Turkey with revenues of $379 million in 2004. International revenues accounted for approximately 40% of this amount. Its asset size was $283 million at the end of 2004. Founded in 1954, TDD is listed on the Istanbul Stock Exchange. TDD’s manufacturing facilities are located mainly in Inegol and Bozuyuk in Central Anatolia, Turkey.
The proposed project consists of:
- the expansion of TDD’s panel radiator plant and combination boiler plants at Bozuyuk; - the modernization and investments in new product development, including solar-energy powered water heating systems; and
- working capital, project contingencies and some debt refinancing for an estimated total cost of EUR55 million ($66 million). |
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| Project sponsor and major shareholders of project company |
The project will be implemented by TDD.
Koc Group companies own 73.9% of TDD’s shares, Taylan Holding owns 5.7%, and the remaining 20.4% is publicly owned. Founded in 1926, the Koc Group is one of Turkey's leading diversified conglomerates with activities in the automotive, household appliances and electronics, financial services, food, retailing, energy, hospitality and information technology sectors. The Group has a long history of cooperating with international firms as evidenced through joint ventures, as well as production and licensing agreements with companies like GE, Siemens, Whirlpool, LG Electronics, Fiat, and Ford. At end-2004, the Koç Group comprised of 106 companies employing about 60,000 staff. Koç Holding and 14 Koç Group company shares are traded on the Istanbul Stock Exchange. |
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| Total project cost and proposed IFC investment |
| The project cost is estimated at approximately EUR55 million (US$66 million). The IFC financing is an A loan of EUR25 million for its own account. |
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| Location of project and description of site |
| The company is headquartered in Inegol. Its main manufacturing facilities are located in both Inegol and Bozuyuk in central Anatolia, Turkey. This project will be implemented mainly at the Bozuyuk plant. |
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| Project Development Impact and IFC's Role |
The proposed IFC investment will improve TDD’s competitiveness and enable it to
- provide better value to the growing domestic market; and
- earn valuable foreign exchange through increased exports.
As important, the project will support Turkeys’ ability to replace part of its fossil fuel consumption with more environmentally friendly natural gas. It will further support direct and indirect employment creation through expansion of capacity, and forward and backward linkages related to outsourced components, transport, installation and after-sales services in Turkey. While directly employing about 1,500 people, TDD’s sales and distribution network in Turkey includes 2,000 sales points and 300 authorized service stations.
The IFC role in the project involves provision of long-term financing, which was difficult to obtain for maturities longer than 5 years. In addition, TDD would like to benefit from IFC’s global experience in a variety of emerging markets, including China, where TDD has a small subsidiary. By offering access to a variety of products, expertise and funding sources, IFC can play a role in helping TDD maintain high environmental and corporate governance standards. |
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| 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, worker health and safety (EHS), and social/community impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical, environmental, health and safety, social and community information submitted by the project sponsor as well as site visits to the Inegol and Bozuyuk plants The following potential environment, health and safety (EHS) and social/community impacts of the projects were analyzed.
- The compliance of TDD’s Bozuyuk plant with Turkish and IFC EHS requirements;
- The commitment of TDD to quality and efficiency and to EHS performance including international certifications;
- Labor, community and social issues.
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
| The company’s website, the gates of the Bozuyuk and Inegol plants, Bozuyuk municipality house, local news papers. |
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| To contact the project company, please write to: |
Mr. Orhan Ercek, Assistant GM, Finance
Turk Demir Dokum Fabrikalari A.S.
Organize Sanayi Bolgesi 16400 Inegol-Bursa
Tel: 90 224 714 8200
Fax: 90 224 714 9838 |
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