31466 - Lidl Romania

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Summary of Proposed Investment

Project Number

31466

Company Name

LIDL ROMANIA SCS

Date SPI Disclosed

Nov 8, 2011

Country

Romania

Industry

Tourism, Retail and Property

Projected Board Date

Dec 9, 2011

Status

Completed

Sector

Retail (Including Supermarkets, Grocery Stores, etc.)

Department

Regional Industry - MAS ECA

Environmental Category

B - Limited

Previous Events

Approved : Dec 14, 2011
Signed : Dec 15, 2011
Invested : Jan 18, 2012

Project Description

Lidl, a chain of discount grocery stores owned by the Schwarz Group (the “Group” or the “Company”) is implementing a long-term expansion plan in Romania by opening new Lidl discount stores (“Lidl Romania” or the “Project”). The Group, one of the largest European food retail discounters, has requested IFC to provide a long-term loan to its Romanian subsidiaries to partially finance the Project.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	66.57
Equity

Development Impact

Improvement in green building standards: As one of the few global retailers in the food discount stores segment in Romania, the Sponsor will, through the Project, contribute to the improvement of local green building standards by applying the highest level of energy efficiency measures, in line with the ones prevalent in its home market of Germany; which would help the new Lidl stores exceed IFC''s Green Building standard

Food Supply chain development: Schwarz''s expansion will (i) increase the number of its local suppliers, (ii) provide additional sales channels for local fresh and dry food producers in Romania, and (iii) contribute to improvements in food security and availability, as well as in efficiency and operating standards throughout the supply chain.

Benefits to low income consumers: By expanding the modern discount format in frontier regions and secondary and tertiary cities of Romania, Schwarz will be able to improve access of local low income customers to a more affordable diverse selection of high-quality food products.

Employment generation: The Project will create significant local direct employment (mostly women who represent more than 60% of Lidl employees), and indirect employment in the retail value chain.

Provision of long-term financing: As IFC is well familiar with the Sponsor, it will be able to provide Schwarz with a sizeable loan to its Romanian subsidiaries in a swift manner and on conditions well tailored to reflect the Project profile, which has been difficult to raise in the current European markets conditions.

Environmental and social performance: IFC''s E&S expertise will ensure that the Project be implemented based on the high relevant standard in an environmentally and socially sustainable and responsible way.

The key environmental and social issues for this multi-site retail transaction relate to Lidl Romania’s management of ongoing environmental, health and safety and labor issues in the construction and operation of its stores and distribution centers, with particular focus on environmental assessment and planning requirements, provision of safe and fair working conditions, occupational health and safety, energy efficiency and management of greenhouse gas emissions arising from energy use and release of refrigerants, solid waste management, life and fire safety and land acquisition.

These issues may all be readily mitigated and are relatively minor and reversible. This is therefore an environmental and social Category B project.

Contacts

For Inquiries About the Project, Contact

Schwarz Finanz und Beteiligungs GmbH & Co. KG
International Finance
Stiftsbergstraße 1
74172 Neckarsulm
Phone: +49 (0) 7132 94-2000
Fax: +49 (0)7132 94-2850

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Fax: 202-974-4384
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Local Access of Project Documentation

Lidl Discount S.R.L
Bd. Dimitrie Pompeiu Nr. 6E
020335 Bucuresti

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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