The Company is publicly listed in the Buenos Aires Stock Exchange. Aluar is majority-owned by the Madanes Quintanilla family and related third parties with shareholding stake of 76% of the Company’s total shares. Aluar’s remaining shareholders are: (i) National Social Security Administration (“Anses”) - 11%; and (ii) free-float - 13%.

IFC is considering an investment in Aluar to finance the Company’s Investment Program.

25.0 million (USD)

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

* These investment figures are indicative

Aluar’s Investment Program consists of an expansion of its main industrial plant located in Puerto Madryn (Province of Chubut). Aluar’s nominal production capacity of primary aluminum shall be increased by 45,000 tpy to 455,000 tpy in 2011.

The Company’s Investment Program would:

(i) Continue to provide good employment opportunities, as Aluar is one of the largest employers in the region with over 2,200 staff in FY08. The project implementation will involve contracting a peak of about 2,000 people, after which the permanent net employment generation is about 80 direct jobs and an estimated 300 indirectly;
(ii) Generate additional exports to Argentina estimated to reach up to $130 million per annum, on top of Aluar’s exports of over $600 million in FY08; and
(iii) Foster tax revenues to the government.

IFC would support a globally competitive company to continue with its expansion program in Argentina. In addition, IFC would be supporting an enterprise that sets an example in terms of energy efficiency and environmental and social practices. The Company and the Investment Program have a systemic impact in the economic development of the southern region, providing employment opportunities, and business prospects to distributors, and SME suppliers in the country. Finally, this is an export enabling Investment Program supporting a company with sound track record and more than 30 years of operations in Argentina.

This is a Category B project, according to IFC’s procedure for environmental and social review of projects because adverse project impacts are few in number and readily mitigable, as described below.

Key environmental issues associated with the Puerto Madryn smelter are management of emissions to air of fluorides and perfluorocarbons and carbon dioxide arising from process and electricity generation, management of solid wastes, with special emphasis on spent pot linings; elimination of wastewater discharges to the sensitive Golfo Nuevo bay; and decontamination of PCB-containing transformers.

The Futaleufú hydroelectric plant, which is 60% owned by Aluar, has an environmental management program to deal with PCBs and other contaminants, and robust emergency preparedness and response measures.

Aluar sites have ISO 14001-certified environmental management systems, regularly audited by international companies, are compliant with all national environmental requirements. Aluar regularly monitors its environmental performance and reports its findings to government authorities and other stakeholders.