37375 - ASHMORE ANDEAN FUND II LP

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Summary of Investment Information

Project Number

37375

Company Name

ASHMORE ANDEAN FUND II LP

Date SPI Disclosed

Nov 20, 2015

Country

Colombia

Region

Latin America and the Caribbean

Projected Board Date

Jan 6, 2016

Environmental Category

FI-1 - Significant

Status

Active

Last Updated Date

Dec 21, 2023

Department

Equity Portfolio Management

Industry

Funds

Previous Events

Approved : Jan 6, 2016
Signed : Jan 15, 2016
Invested : Oct 11, 2016

Sector

Growth Equity Fund

Project Description

The project entails and IFC equity commitment of up to $25 million, not to exceed 20% of total commitments, in Ashmore Andean Fund II, LP (the “Fund”), a private equity fund that will make investments in middle market, infrastructure-related businesses primarily in Colombia.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	25.0

Development Impact

(i) Emerging market private equity industry development: Private equity remains an important source of capital and expertise, particularly for small- and mid-market businesses and projects that IFC cannot invest in directly. IFC continues to play an important role in catalyzing PE industries in its target markets by supporting early entrants into the space and by continuing to back those with sustainable and proven models. (ii) Economic development and job creation: The Fund will provide equity capital to help develop and grow businesses and projects in the region, which will help promote economic growth, regional and global competitiveness, sustainability, and job creation. (iii) Strengthening businesses: The Fund will strengthen businesses from a financial, operational, management, and ESG perspective, thereby helping to make local projects attractive to foreign investors/acquirers, and encouraging further private investment in the region.

(i) Catalytic role: Several new and existing investors have indicated that an IFC investment would serve as a "stamp of approval" for the Fund Manager and its success in Fund I. Some have explicitly stated that they will not invest in Ashmore II without IFC, they view IFC as a key Fund I investor. (ii) Environmental and social: IFC will be able to continue to assist the GP in enhancing its E&S practice, and to ensure it is applied comprehensively and consistently to its underlying infrastructure-related investments. (iii) Fund structuring and governance: As a continuation from Fund I, IFC will help the Fund approach international best practices with respect to structure, terms, and governance, which will further improve the GP's attractiveness to commercial investors. (iv) Regional support: IFC's presence, its experience in direct infrastructure investing, and its network will provide the Fund Manager a partner to help advise on investments and help build additional relationships in the region. (v) Additional financing: IFC will have the opportunity to provide additional equity and debt financing to the Fund's projects through co-investments.

E&S Category Rationale / Risks and Mitigation

The Fund will target equity investments in infrastructure related sectors primarily in Colombia, Peru and Central America. As an existing client, the Fund's sponsor, Ashmore Management Company Colombia has developed an ESMS and provided relevant information regarding the E&S performance of its portfolio. The Fund currently makes use of reputable external E&S consultants to inform its E&S due diligence. Given the higher risk of potential pipeline of the proposed project, Ashmore will be required to enhance its ESMS including the development of an external communication mechanism and hiring a senior E&S staff member to support its investment decision making process and supervision. Investments may include projects in sectors such as (a) transportation, (b) power (c) oil and gas (d) logistics, (e) telecommunications (f) waste management (g) water management and (h) social infra (Education and Healthcare). The Fund’s portfolio is expected to include activities with significant adverse Environmental and Social (E&S) risks and impacts, and the project has been classified as Category FI-1 according to IFC's Sustainability Framework.

In accordance with IFC's Access to Information Policy, IFC will periodically disclose the names, locations and sectors of sub-projects that have been supported by IFC investments through private equity funds, subject to regulatory constraints and market sensitivities. The sub-project(s) listed below reflect(s) the status of the portfolio as of January 1, 2025.

Investee	Country Of Investment	Sector
Concesion Santa Marta - Paraguachon S.A	Colombia	E-BC - Highway Operations (Includes Toll Roads)
Elecnorte S.A.S E.S.P	Colombia	V-DA - Electric Power Transmission
Electribus Usme / Fontibon S.A.S	Colombia	E-AD - Transit and Ground Passenger Transporation
Infraestructuras y Energías del Perú IEP S.A.C	Peru	V-AC - Heavy Fuel Oil - Thermal Power Generation
Redcol Holding S.A.S	Colombia	T-AA - Elementary and Secondary Schools
S.F Convias S.A.S	Colombia	E-BC - Highway Operations (Includes Toll Roads)
Termomechero Morro S.A.S E.S.P	Colombia	V-AB - Gas - Thermal Power Generation
Transinnova Usme S.A.S	Colombia	E-AD - Transit and Ground Passenger Transporation
Bureche	Colombia	T-AA- Elementary and Secondary Schools
Stracon	Peru	B-FA- Mining Services

The key risks and impacts derive from Ashmore’s capacity to maintain the operation of its management system, identifying and managing the potential environmental and social risks associated to projects in pipeline including but are not limited to: (i) environmental risks such as air emissions, waste management, hazardous materials, (ii) OHS (occupational health and safety) risks such as process safety, gas releases, chemical hazards and fire and explosions, (iii) community issues such as land acquisition, health, safety and security; potential impacts on indigenous and other vulnerable communities, (iv) biodiversity conservation and stakeholder engagement.

The Fund manager will be required to ensure compliance of the investments made with the IFC Exclusion List, the E&S national laws and regulations and the IFC Performance Standards. IFC will review the first three ESDDs after commitment and additional ones as needed as well as that of all Category A sub-projects prior to the Fund’s investment to support the implementation of the ESMS.


Task Title & Description	Anticipated Completion Date as Disclosed in SII
Staff Training
Enhance ESMS, guidelines and implementation practices

IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring them to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities.

In addition, Affected Communities have unrestricted access to the Compliance Advisor/Ombudsman (CAO), the independent accountability mechanism for IFC. The CAO is mandated to address complaints from people affected by IFC-supported business activities in a manner that is fair, objective , and constructive, with the goal of improving environmental and social project outcomes and fostering greater public accountability of IFC.

Independent of IFC management and reporting directly to the World Bank Group President, the CAO works to resolve complaints using a flexible, problem-solving approach through its dispute resolution arm and oversees project-level audits of IFC’s environmental and social performance through its compliance arm.

Complaints may relate to any aspect of IFC-supported business activities that is within the mandate of the CAO. They can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC-financed business activity. Complaints can be submitted to the CAO in writing to the address below:

Compliance Advisor/Ombudsman
International Finance Corporation
2121 Pennsylvania Avenue NW
Room F11K-232
Washington, DC 20433 USA
Tel: 1 202 458 1973
Fax: 1 202 522 7400
E-mail: cao@worldbankgroup.org

The CAO receives and addresses complaints in accordance with the criteria set out in its Operational Guidelines which are available at: www.cao-ombudsman.org

Contacts

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Telephone: 202-473-3800
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IFC supports its clients in addressing environmental and social issues arising from their business activities by requiring its real sector clients to set up and administer appropriate grievance mechanisms and/or procedures to address complaints from Affected Communities in relation to environmental and social issues arising from IFC's clients' business activities. Since 2012, IFC's Financial Intermediary clients applying the Performance Standards are required to develop External Communications Mechanisms to receive and review inquiries or complaints from any interested party regarding the E&S risks and impacts of their operations.

For IFC projects that are active or under consideration, individual(s), or their authorized representative(s), who allege they have been or will be adversely affected by E&S risks or impacts arising from IFC's clients' business activities, may submit a complaint to IFC directly for consideration. When receiving an E&S complaint, IFC engages with complainants and works with its clients to find solutions to E&S concerns as quickly and efficiently as possible.

Complaints can be submitted to IFC online at www.ifc.org/escomplaints or by email to EScomplaints@ifc.org.

IFC complaint response is separate from and complementary to IFC’s clients’ project level grievance mechanisms and IFC’s Independent Accountability Mechanism (CAO). Lodging a complaint directly with IFC does not, at any time, restrict access to CAO.

Affected communities have unrestricted access to the Compliance Advisor Ombudsman (CAO), the independent accountability mechanism for IFC and MIGA. CAO facilitates the resolution of complaints related to IFC and MIGA projects and sub-projects, undertakes reviews of IFC’s and MIGA’s environmental and social compliance, fosters public accountability for their commitments, and enhances the environmental and social performance of IFC and MIGA.

Independent of IFC and MIGA management and reporting directly to the IFC and MIGA Boards of Executive Directors, CAO helps resolve issues raised about the environmental and social impacts of projects through a neutral, collaborative, problem-solving approach via its Dispute Resolution function. It also reviews IFC’s and MIGA’s compliance with environmental and social policies, assesses related harm, and recommends remedial actions through its Compliance function. Additionally, CAO provides advice to IFC, MIGA, and their Boards to enhance environmental and social sustainability performance and minimize the risk of harm.

Complaints may relate to environmental and social harm regarding any aspect of the planning, implementation, or impact of a project or sub-project, and can be made by any individual, group, community, entity, or other party affected or likely to be affected by the environmental or social impacts of an IFC- or MIGA-financed business activity.

Complaints can be submitted by any of the following methods:

Online form: available at https://www.cao-ombudsman.org/
Mail/Hand Delivery to: 2121 Pennsylvania Avenue, NW, Washington, DC 20433, USA
Voice mail: +1 202 458 1973
Email: cao@worldbankgroup.org
SMS, WhatsApp, Telegram, and Signal: +1 202 650 2627

CAO receives and addresses complaints in accordance with the CAO Policy, which can be accessed at: https://www.cao-ombudsman.org/policies-guidelines.

This Summary of Investment Information (SII) is prepared by IFC to disclose a factual summary of the main elements of the potential investment. It also includes findings and recommendations related to environmental and social considerations regarding this potential investment. The purpose of the SII is to enhance the transparency of IFC’s activities. For any project documentation or data included or attached herein, whether prepared by the project sponsor or otherwise, authorization has been given for public release by the project sponsor. IFC considers that this SII is of adequate quality for release to the public, but has not necessarily independently verified all of the project information therein. It is distributed in advance of IFC Board of Directors’ consideration and may be periodically updated thereafter. Board dates are estimates only and this document should not be construed as presuming the outcome of the Board Directors’ decision. The following SII is disclosed in accordance with IFC's Access to Information Policy (AIP) that went into effect on January 1, 2012.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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