Summary of Proposed Investment
Project Number
9588
Company Name
Convergence Communications, Inc.
Date SPI Disclosed
Jul 20, 1999
Country
World Region
Industry
Telecommunications and Technology
Status
Completed
Sector
Cable and Broadband
Department
TMT, Venture Capital & Funds
Environmental Category
B - Limited
Previous Events
Approved : Nov 8, 1999
Signed : Nov 17, 1999
Invested : Nov 18, 1999
Project Description
Summary Of Project Information (SPI)
| Project Name: | South and Central America: Convergence |
Region:Latin America and Caribbean
Sector:
Project No:009588
Projected Board Date:August 23, 1999
Company Name:Convergence Communications, Inc.
Technical Partner and/or Major Shareholders
The principal shareholders in Convergence, as of March 1, 1999 include:
D''Ambrosio Family - a Utah-based family with interests in telecommunications CATV operations. (47%)
Internexus - a holding company controlled by two Argentine families. (18%)
FondElec - FondElec Essential Services Growth Fund, a US-based private equity fund representing over $100 million of investments in Latin American utilities. (18%)
Project Cost Including proposed IFC investment
Total capital expenditure for the period 1999-2000 is estimated at US$35 million. The bulk of this capital expenditure will be used to provide customer premises equipment, with some expansion and upgrade of the current infrastructure to provide high bandwidth service to its customers.
IFC is proposing a US$5 million equity investment in convertible preferred shares per the terms of the private placement.
Location of project and Description of site
The Company''s existing operations are in Guatemala, El Salvador, Venezuela with operations starting up in Panama, Costa Rica and Mexico.
Description of Company and Purpose of Project
Convergence Communications, Inc. ("Convergence" or the "Company") is a facilities-based provider of a full range of broadband communication services. Convergence currently offers business, governmental and residential customers high-bandwidth, high-speed data connections, high-speed and dial-up Internet access, voice and video services. The Company operates, and intends to operate, in recently deregulated and high growth markets, principally in Central America, the Andean region and Mexico. Existing operations are in Guatemala, El Salvador and Venezuela, with Mexico, Panama and Costa Rica targeted for operations later this year.
The project consists of the expansion of the Company''s existing operations in Guatemala, El Salvador, and Venezuela and the start-up of operations in Panama, Costa Rica and Mexico). In future years of operation, the Company intends to develop its own international backbone capability, to be managed from a Network Operations Center (NOC) in Florida, and offer a wide variety of other telecommunication services, including IP telephony and facsimile services, video conferencing, web hosting, and virtual private networks.
Environmental Category and Issues
This is a Category B project according to IFC''s environmental and social review procedure because specific impacts may result which can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria.
The following potential environmental, safety and health and social impacts of the project were analyzed: land acquisition (including physical or economic displacement of people); use and storage of hazardous materials (including PCB''s and CFC''s); stand-by generator fuel storage and handling; truck fleet maintenance and related hazardous materials and waste disposal; fire prevention and emergency response and employee health and safety, and training.
Convergence will not need to acquire or lease land for construction of new facilities. The Company may have to gain right-of-way access for installation of some new cable lines, but does not expect to have to physically or economically displace people in the process. In the unlikely event that Convergence''s activities will cause the physical or economic displacement of people, the Company will consult with the IFC, and as appropriate, submit a plan for relocation.
For all of its facilities, Convergence will retain an independent expert to produce Fire and Safety Plans which will include recommendations for installation of fire extinguishers and alarms, as well as implementation of procedures for fire prevention and safety, the proper use of emergency equipment, and provision of regular fire drills.
Convergence will develop an employee health and safety manual for all of its operations, with policies, procedures and programs consistent and in compliance with the requirements of the World Bank Group Guidelines. These will include adequate employee health and safety training programs to be provided by local consultants.
The is from the InfoShop.
| Host country location of environmental documents | Headquarters, Salt Lake City, Utah, USA |
Date SPI sent to InfoShop: July 20, 1999
“This Summary of Project Information is prepared and distributed to the public in advance of consideration of the proposed transaction by the Corporation’s Board of Directors. It is provided for the purpose of enhancing the transparency of IFC’s activities and should not be construed as presuming the outcome of IFC Board consideration.”
For Additional Information contact: Corporate Relations Unit -
telephone: (202) 473-7711
facsimile: (202) 974-4384
Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).
Sponsor / Cost / Location
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