26878 - CTI Group II

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Summary of Proposed Investment

Project Number

26878

Company Name

CTI GROUP INC.

Date SPI Disclosed

May 8, 2008

Country

Jordan

Industry

Infrastructure

Projected Board Date

Jun 9, 2008

Status

Completed

Sector

Water Transportation

Department

Gbl Infrastructure & Natural Resources

Environmental Category

B - Limited

Previous Events

Approved : Dec 19, 2008
Signed : Dec 30, 2008
Invested : Mar 12, 2009

Project Description

Ranked among the largest specialized cement carrier fleet owners in the world, CTI Group Inc.’s (CTI or the company) activities cover all aspects of logistics for the specialized cement trade including trading, handling and transport, as well as operating a fleet of 9 dry bulk carriers. Operating on a global basis, the company is embarking on an expansion program to expand its fleet of cement and dry bulk carriers. IFC’s financing would be used to cover part of the costs of acquiring the additional vessels, beginning with the purchase of a cement carrier which the company is already operating on a bareboat charter basis. This expansion will help CTI optimize its fleet structure and expand its transport operations.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	16.0
Equity

Development Impact

The company has had positive economic and developmental impacts and the current project is expected to facilitate this. By shipping and trading cement between countries with cement production surpluses (and low prices) and countries facing shortages (and high prices), the Group allows both sides to benefit and enhances the efficiency of the global cement market. The project will facilitate cement exports from countries with excess supply (like Pakistan, China and India) to countries where there is a shortage of cement production capacity (like the US and the Middle East). Therefore, both the cement industry in exporting countries and the construction industry in importing countries would benefit from the Project. With an estimated 6-7% market share of specialized seaborne cement carrier trade, CTI is a significant player but not one of the largest, so its activities contribute to making the industry more competitive.

IFC’s long term financing will help fill a critical funding gap and allow CTI to match its long term assets with long term finance which remains unavailable in the local capital market. The success of this project would serve as a demonstration effect for local banks looking to finance shipping companies in the region and may encourage them to consider longer tenors for such investments. The successful penetration of a global and competitive market by Jordanian entrepreneurs could induce other entrepreneurs in the region to emulate their success. The proposed conversion option on IFC’s convertible loan would enhance the Group’s attractiveness in the event of the sale of shares to new investors while the B loan would be a means of introducing CTI to international capital providers.

IFC’s ongoing supervision of the company’s shipping activities indicates that this new investment will not result in any material change in the management of environmental and social impacts and risks. Key environmental and social issues and mitigation are essentially the same as those described for the original investment, and CTI continues to demonstrate its ability to manage these appropriately. In particular, the company continues to comply with international maritime standards under SOLAS, MARPOL, the International Safety Management (ISM) code, and with IFC Performance Standards. The current Environmental and Social Risk Rating (ESRR) for the existing project is Excellent.

Contacts

For Inquiries About the Project, Contact

This SPI contains a summary of IFC’s review prepared for the project. Additional information can be obtained directly from the following contact:

Mr. Nawras S. Anfoka
CFO,CTI Group
Amman Regional Office
PO Box 7676 Amman 11118 Jordan

Phone: +962 6 5685115
Fax: +962 6 5676939

For Inquiries and Comments About IFC, Contact

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2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster

Local Access of Project Documentation

Mr. Nawras S. Anfoka, CFO,
CTI Group
Amman Regional Office
Amman 11118
Jordan

Phone: +962 6 5685115
Fax: +962 6 5676939

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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