IFC and Germany
Partners in Private Sector Development
OVERVIEW
IFC, a member of the World Bank Group, is the largest global development institution focused on the private sector in emerging
markets. Working with more than 2,000 businesses worldwide, IFC’s long-term investments in developing countries rose to nearly $18
billion in FY15. Germany is one of IFC’s most important partners, with substantial investments and much potential for further growth.
IFC’s total committed portfolio with German Sponsors of $582 million is focused on Germany’s strengths, with nearly two-thirds in
manufacturing and services and the rest almost evenly split between infrastructure and finance. Germany’s development institutions,
KfW Banken Group and GIZ, are important partners in areas such as development, micro, agrifinance, and sustainable energy.
IFC’s Committed Long-Term Investment Portfolio with German Sponsors
As of June 30, 2015, IFC’s committed long-term investment portfolio with German sponsors amounted to $582 million. German
private sector companies have benefited from co-investments with IFC while making notable contributions to development in
emerging markets.
IFC Committed Long-Term Investment Portfolio as of
IFC Committed Long-Term Investment Portfolio as of
June 30, 2015 by Industry with German Sponsors ($582 million)
June 30, 2015 by Region with German Sponsors ($582 million)
Retail
Finance & Insurance
Europe & Central Asia
Global
Transportation
Industrial & Consumer
Products
Cement
Solar
Sub-Saharan Africa
Latin America & the
Caribbean
South Asia
Education
Other
East Asia & the Pacific
•
Mobilization: IFC has a strong relationship with German financial institutions (FIs) and an active engagement across multiple
sectors. As of June 30, 2015, German FIs held approximately $1.12 billion in IFC Syndicated Loans, of which $200.1 million was
mobilized in FY15.
•
Global Trade Finance Program (GTFP): As of June 2015, IFC had issued 3,019 guarantees amounting to over $5.8 billion to banks
in Germany since the program began in 2005. The most active confirming banks have been Deutsche Bank and Commerzbank,
followed by BHF, LBBW, DZ Bank, WGZ, and Unicredit HVB.
Examples of Successful Cooperation
Schwarz Group
The Schwarz Group, headquartered in Germany, is a privately held group of companies which is involved
in discount food retail through Lidl and Kaufland. IFC has worked with the Schwarz Group since 2004 by
supporting Lidl and Kaufland’s long-term expansion plan in Bulgaria, Croatia, Poland, and Romania as the
group opened new Lidl discount stores and Kaufland supermarkets in these countries. This has involved several investments over
the past 10 years for a total of over $400 million. IFC has provided counter-cyclical, long-term financing by supporting Schwarz
Group’s expansion in the face of the financial crisis and liquidity constraints prevalent in the market. IFC also assisted Schwarz in
identifying areas of further improvement in energy savings practices. The projects benefit small to large local suppliers by applying
strict standards in food quality, safety and efficient operations and providing additional sales channels to local fresh and dry food
producers. It also creates local direct employment, and indirect jobs through retail supply chains and related services companies.
Dafiti and Lamoda
IFC invested €15 million of equity in Dafiti and €10 million of equity in Lamoda, two online retailing
ventures incubated and supported by Rocket Internet, to facilitate Dafiti’s expansion in Latin America and
Lamoda’s in Kazakhstan, Russia, and, possibly, other countries in the region. The projects will generate
employment in the logistics, warehousing, IT and marketing sectors; facilitate the transfer of a replicable business model in
emerging markets; and provide consumers in frontier regions and secondary cities with a competitively priced selection of goods.
Heidelberg Cement
Heidelberg Cement launched an investment program to grow and modernize its existing operations in
the cement sector in Sub-Saharan Africa. IFC provided an investment of up to $110 million in equity and
a debt facility of up to $70 million and helped the company improve energy efficiency and increase the capacity of its operations
in several IDA countries. IFC African, Latin American and Caribbean Fund, managed by IFC Asset Management Company LLC,
committed up to $35 million. The total cost of the project was $312 million. IFC provided long-term financing that would not
otherwise be available, and demonstrated investment opportunities in the Sub-Saharan Africa region. IFC also assisted Heidelberg
Cement in upgrading its energy-efficiency in all of its facilities in the seven countries concerned. The project stimulated other local
housing and infrastructure projects.
Fraport
IFC has worked twice with Fraport, a German transport company which operates Frankfurt Airport
in Frankfurt am Main and holds interests in the operation of several other airports around the world.
IFC collaborated with Fraport to streamline the shareholding structure of the operator of Lima’s Jorge
Chavez International Airport (JCIA), Peru’s primary international airport. The total cost of the project was approximately $115
million, including $20 million in equity from IFC. MIGA also provided a guarantee to protect Fraport’s investment. IFC acted as a
catalyst for further (foreign) investment by private equity, pension funds and other investors, and for private sector participation
in local and regional infrastructure, and played a stabilizing role for the capital structure as long-term equity partner. IFC also
partnered with Fraport in expanding, developing and maintaining Pulkovo Airport in St. Petersburg, the fourth largest airport
in Russian Federation by traffic, behind Moscow’s three airports. The total cost of this project was approximately €1.2 billion, of
which IFC committed a €70 million senior loan and syndicated a €100 million senior loan from commercial banks. IFC has played
a crucial role in structuring a bankable project, co-leading a consortium of other international financial institutions, mobilizing
commercial bank financing, developing a thorough environmental and social action plan and providing technical expertise. In
both projects, as lead operator, Fraport is improving the efficiency of airport operations and transferring knowledge to local staff.
Affero Lab / Bertelsmann
Affero Lab Participações S.A., a Brazilian education company and the leader in the corporate training market
in Brazil, provides training solutions for corporations through a Business to Business (B2B) model. It was
formed in 2013 through the merger of the two largest companies in the corporate education sector in Brazil,
Affero, which was specialized in online training, content and knowledge management, and Lab SSJ, whose
expertise was classroom/instructor led training. Affero Lab’s is undertaking a 5-year Investment Plan, which comprises organic
growth and expansion of current operations and the development of new vertical partnerships. In addition, potential acquisitions
in the domestic and international markets are also a possibility but will depend on asset availability and valuation.
CONTACT
Karsten Fuelster
Principal Investment Officer
Country Manager: Germany,
Austria, and Switzerland
Tel: +49 69 74 34 82 50
E-mail: KFuelster@ifc.org
WESTERN EUROPE COUNTRY OFFICES:
BRUSSELS
Tel: +32 2 522 00 39
LONDON
Tel: +44 207 592 8400
FRANKFURT
Tel: +49 69 743 48230
PARIS
Tel: +33 1 40 69 30 60