26566 - Arcor Exp

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Summary of Proposed Investment

Project Number

26566

Company Name

ARCOR S.A.I.C.

Date SPI Disclosed

Nov 7, 2007

Country

Argentina

Industry

Agribusiness and Forestry

Projected Board Date

Dec 7, 2007

Status

Completed

Sector

Other Food

Department

Gbl Ind, Manufact, Agribus & Services

Environmental Category

B - Limited

Previous Events

Approved : Dec 13, 2007
Signed : Dec 20, 2007
Invested : Jan 9, 2008

Project Description

Arcor S.A.I.C. (Arcor or the company) is one of the leading producers and distributors of candies, chocolates and cookies in South America. The project entails providing a corporate loan to Arcor to finance its capital expenditures program and replace maturing debt.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	50.0
Equity

Development Impact

The proposed investment supports the further expansion of an Argentine-based South-South player, making a contribution to local economic development, through

- job creation as the Group increases its manufacturing capacity in existing plants, and
- incremental taxes for the government.

In Argentina, Arcor has more than 13,900 employees, with a substantial portion of them located in the interior of the country, including frontier provinces such as Catamarca, Entre Ríos and Tucumán. As several of its facilities are located in small cities, Arcor’s support is key for the development of its surrounding communities. Furthermore, the Group has developed more than 160 SMEs in Argentina to work as exclusive distributors, employing more than 2,500 salespeople. IFC will continue to partner with a group with a strong corporate social responsibility culture, which supports a variety of programs in education, training, health, culture, and research through diverse corporate initiatives, the Fundación Arcor (Fundación), and Instituto Arcor Brazil.

The project is in line with IFC’s strategy to contribute to sustainable economic growth by supporting a competitive family-owned company to firm-up its core operations in Argentina and sustain its regional expansion. Arcor operates in a priority sector for Argentina and is largely export-oriented with South-South expansion plans. IFC is uniquely able to support growing companies operating under volatile financial markets. Also, through the B Loan program, IFC will be encouraging commercial banks to provide financing with improved terms.

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. The review of this project consisted of appraising technical, environmental, health, safety and social information submitted by the project sponsor and subsequent field visits.

Contacts

For Inquiries About the Project, Contact

The ESRS will be available to the public at the following locations:

- Municipalidad de Salto (Bs. As.): Buenos Aires y Alvear; Salto, 2741; Provincia de Buenos Aires
- Municipalidad de Colonia Caroya (Córdoba): Av. San Martín # 3899; Colina Caroya, 5223; Provincia de Córdoba
- Municipalidad de Arroyito (Córdoba): Rivadavia # 413; Arroyito, 2434; Provincia de Córdoba
- Municipalidad de Lules (Tucumán): Almirante Brown # 601; Lules, 4128; Provincia de Tucumán
- Arcor do Brasil: Edificio Continental Square 16th floor; Rua Olimpíadas, 205 - Vila Olímpia; São Paulo - Brasil
- Ind. de Alimentos Dos en Uno: Placer 1324; Santiago de Chile; Chile

Project’s company contact:

Gerencia de Medio Ambiente
www.arcor.com.ar
Fax: (54351) 420-8479
Tel: (54 351) 420-8200
Bvar. Chacabuco 1160, Nueva Córdoba, Córdoba, Argentina

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Washington DC 20433
Telephone: 202-473-3800
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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. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

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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