The Maldonado Quiroga family of Monterrey (Mexico) founded the Copamex in 1928 and still maintains approximately 100% ownership. The Maldonado family has two branches, namely the well known and reputable Maldonado Elizondo and Maldonado Gonzalez families. The members of the Maldonado Elizondo family own in aggregate 92% of the company and play a bigger role in the management of the Copamex than the Maldonado Gonzalez family with 8%. The Maldonado family is active in philanthropic and charitable causes through the Fundación de Beneficiencia Maldonado Quiroga, a 14-year old not-for-profit entity that gives donations to low-income groups in Monterrey.

The estimated Project Cost of $262 million is to refinance part of the company’s debt and to fund capital expenditure for modernizing and rationalizing some of the Copamex’s existing facilities. The capital expenditure component of the project is not part of an expansion program, it consists instead of various investments necessary to keep the facilities competitive. The IFC’s proposed investment would consist of a up to $50 million A loan for IFC’s own account, a up to $107 million B loan for the account of participants banks, and a up to S$25 million quasi-equity C loan for IFC’s account. The company has expressed interest in obtaining Mexican peso financing in order to minimize its foreign exchange exposure and as such IFC is considering providing its A loan in pesos, arranging local currency parallel loans (the “Parallel Loan”, for the account of local lenders) to replace the IFC B loan. In the event that the Parallel Loan is insufficient, IFC will consider swapping any IFC B loan then required to complete the financing plan in pesos.

25.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management	0.0
Guarantee
Loan	25.0
Equity

* These investment figures are indicative

The company headquarters are located in Monterrey, in the State of Nuevo Leon, which borders with the United States (Texas). The Copamex’s main facilities are located in the states of Nuevo Leon, Chihuahua, Mexico State, Michoacán and Jalisco. The company also has other facilities in the United States and Central America.

This is an environmental review category B project. Environmental, social, occupational health and safety issues include: air emissions from boilers, generators and other sources; process water use and process and sanitary wastewater treatment and disposal; energy efficiency; hazardous and solid waste management; hazardous materials storage and handling; fire protection and emergency response; general workplace health and safety including exposure to noise and chemicals; and management of staff reduction program.


Location of environmental documents in locally affected community
The environmental document Environmental Review Summary (ERS) will be available at Copamex’s headquarters (see below for address) and on the company’s website: www.copamex.com.

As the company shifts its production focus toward areas in which it has stronger competitive advantages, Copamex’s profitability will increase. Specifically, consumer and packaging products will be emphasized taking full advantage of the Company’s proximity to the market and its brands. By refinancing US dollar debt with new peso financing with longer maturity, the company’s foreign exchange risks will be reduced and longer maturities will free up resources. Consequently, the enhancement of Copamex’s liquidity will allow its management to better focus on production and market issues and have the resources to invest in improvements. The Project is also expected to support the viability of an important source of employment for 6,878 people in the company. Copamex contributes to the hygienic living standards of the people in the country through the production and distribution of affordable consumer products to all segments of the society. The company significantly contributes to recycling wastepaper and cardboard generated in Mexico and abroad, since around two thirds of its raw material fiber is recycled. By adopting IFC's environmental, health and safety policies and guidelines, the company will improve to stricter international practices and reduce risk to the public, while renewed emphasis on safety will provide its employees with safer working conditions. IFC Role: Provide long-term financing better suited to the Copamex’s business dynamics. While Mexico has enjoyed better access to capital following its investment grade rating, the current market volatility and the recessive environment will make it difficult for the company to raise long-term refinancing without IFC’s involvement; IFC expects also to provide some advisory services to improve corporate governance, environmental and social matters.