Water Capital’s shareholders and management team consists of highly experienced professionals who bring unique skill-sets, strong experience and persistence to the pursuit of providing strategic financing to their clients.

The proposed IFC Investment consists of an equity investment of up to MXN 200 million in WCAP Holdings, S.A. de C.V. (Holding company of WCAP) to help finance its provision of operational leases of equipment mainly used for water treatment and efficient water use, as well as energy efficiency projects, thus supporting private sector investments aligned with sustainability and climate change.

15.63 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan
Equity	15.63

* These investment figures are indicative

WCAP is headquartered in Mexico City and has offices in Monterrey, Queretaro and San Francisco.

Increase access to financial services: IFC’s investment will help WCAP to broaden its reach in extending leases to other SMEs and Corporates; Commitment to Sustainability/Energy Efficiency: WCAP would be able to support the growing number of initiatives involving EE/WE with industrial application taking place in Mexico, which may including the use of alternative energy sources; Market development: WCAP’s sales/securitization plans will help to develop the Mexican market; and Demonstration Effect: WCAP’s business model focused in the water treatment industry and equipments related to energy efficiency initiatives is unique in Mexico, where access to operational lease for these types of capital goods is rather limited. WCAP has developed a profitable model on this basis, which could be replicated by other FIs in both Mexico and other countries.

IFC’s investment will help WCAP increase its support to Sustainability/Energy Efficiency projects, while allowing private companies to continue pursuing these investments, even under potential budget and indebtedness constraints on the private sector resulting from the global crisis (use of operational leasing for off-balance sheet treatment of non-core capital expenditures); By sharing its global knowledge, IFC is going to be able to introduce international best practices to the Company; IFC’s presence in the Company’s ownership structure and support in improving its governance procedures and practices will give comfort to prospective investors; and IFC will act as an anchor investor, helping WCAP raise additional financing from the Mexican market and other commercial banks.

This project involves IFC support for the leasing business and has been classified as a Category FI project according to IFC’s Environmental and Social Review Procedure. During appraisal, IFC will analyze the company’s portfolio, leasing assets and activities proposed to be supported with IFC financing. IFC will also review the company’s labor practice and its capacity to manage social and environmental risks. Considering the nature of activities supported, the company will be required to:

Develop and implement a Social and Environmental Management System (SEMS), prior to disbursement, that is satisfactory to IFC, and that ensures that all its investments are screened and processed to avoid supporting activities on the FI exclusion list, and ensures that the maintenance and operation of the leased equipment complies with the applicable national ESHS laws and standards;
Identify qualified persons to manage and implement the SEMS;
Demonstrate commitment and resources to implementing the SEMS;
Demonstrate commitment to applying the labor standards established by the IFC Performance Standard 2: Labor and Working Conditions;
When leasing to business activities with potentially significant environmental and social risks (e.g., mining, oil production), inquire and review S&E information available in the public domain and avoid leasing to businesses that have substantial unresolved environmental and social issues. In such cases, the Company will also need to satisfy itself that the activity is being undertaken in compliance with the applicable national laws; and
Submit a periodic report to IFC as per a format to be provided by IFC.