Summary of Proposed Investment
Project Number
9611
Company Name
Arçelik-LG Klima Sanayi ve Ticaret A.S.
Date SPI Disclosed
Jun 3, 1999
Country
Turkiye
Industry
Manufacturing
Status
Completed
Sector
Household Appliances (Including Refrigerators, Laundry Machine, Dishwashers, etc.)
Department
Regional Industry MAS MCT
Environmental Category
B - Limited
Previous Events
Approved : Sep 30, 1999
Signed : Nov 15, 1999
Invested : Dec 17, 1999
Project Description
Summary Of Project Information (SPI)
| Project Name | Turkey - Arçelik LG-Klima |
RegionCentral and Southern Europe
Sector
Project No009611
Projected Board DateJuly 15, 1999
Company NameArçelik-LG Klima Sanayi ve Ticaret A.ª. ("Arçelik LG" or the "Company")
Technical Partner and/or Major Shareholders
Arçelik A.ª. (Arçelik) was established in 1955, and is the largest private sector company in Turkey, with market leadership in refrigerators, washing machines, dishwashers, vacuum cleaners and air conditioners. Arçelik is 58% owned by the Koç Group, a leading Turkish industrial conglomerate participating in the Turkish automotive, household appliances, consumer goods, energy, construction, international trade, financial services and tourism industries. The Burla Group holds 21% of Arçelik, while the remaining 21% is publicly held and traded on the Istanbul Stock Exchange.
LG Electronics, a member of the LG Group, was established in 1958. Major shareholders include Group companies LG Chemical, LG Yonan Foundation, and LG Insurance which together maintain a shareholding of approximately 12%. LG Electronics is a leading player in the Korean display, home appliance, and multimedia sectors. Formerly known as Lucky Goldstar, LG is a leading international brand name for consumer electronics and white goods.
Project Cost Including proposed IFC investment
Total project cost is estimated at US$ 50.0 million. IFC''s proposed investment consists of a loan for it''s own account of up to US$ 15.0 million equivalent and a syndicated loan of up to US$ 15.0 million equivalent.
Location of project and Description of site
Arçelik LG Klima has purchased 52,000 m2 of land, including 9,300 m2 of factory and administrative building, in the Gebze Organized Industrial District in Kocaeli, approximately 50 kilometers from Istanbul, Turkey.
Description of Company and Purpose of Project
Arçelik LG Klima is a newly established joint venture Turkish company established by Arçelik A.ª. and LG Electronics in 1998. The Project consists of the installation of a greenfield air conditioner manufacturing plant with an initial annual capacity of 200,000 units. The Project will lead to the installation of a new production plant which is intended to upgrade the level of manufacturing technology in the country, while supplying an increasingly environmentally friendly and high quality product for the domestic market and surrounding Mediterranean countries. The project intends to support the international competitiveness of two emerging market companies forming the joint venture by establishing the first air conditioner manufacturing base in Turkey. Likewise, IFC''s involvement will provide long-term financing which is not available locally at reasonable terms.
Environmental Category and Issues
This is a category B project according to IFC''s environmental review procedure. Environmental, occupational health and safety issues which were examined during the review of this project included:
site selection; air emissions; wastewater treatment; solid waste handling and management; handling and storage of hazardous materials; use of ozone depleting substances; fire protection and emergency response; and general worker health and safety.
The IFC Technical and Environment Department staff has reviewed the project site and concludes that this project will be implemented and managed in accordance with World Bank Group environmental, health and safety policies and guidelines and host country requirements. IFC will monitor project performance during the lifetime of the project.
The is from the InfoShop.
| Host country location of environmental documents | Arcelik A.S. 81719 Tuzla Istanbul, Turkey |
Date SPI sent to InfoShop June 3, 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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