Daewoo Intercity project.
Region : Middle East and North Africa
Country : Pakistan
Company name : Daewoo Pakistan
Sector: E-AD - Transit and Ground Passenger Transporation
Date SPI disclosed: August 22, 2013
Project Description: IFC is considering an investment in Daewoo Pakistan Express Bus Service Ltd ( DPEBSL or the Company ), a leading intercity bus service provider in Pakistan. DPEBSL has 4 lines of business as follows: (i) intercity bus service, (ii) city bus service, (iii) cargo operation and (iv) media sales and real estate services. This investment will be used to grow DPEBSL s intercity bus operation, upgrade terminal network, improve IT infrastructure, develop cargo business, as well as repay part of the current debt at the holding level.
1. Through investing IFC will help better capitalize a private sector player offering a quality service at reasonable prices to the middle income segment.
2. Supporting the growth of the Company will provide access to reliable, safe, and reasonably priced transport infrastructure in Pakistan.
3. The project is expected to create employment opportunities in this labor heavy industry.
IFC%s Expected Role and Additionality: 1. Financial risk mitigation: IFC would provide DPEBSL with a loan of up to 6 years, which is otherwise difficult to obtain in Pakistan, with a repayment profile that does not add financial pressure on the Company during its years of growth.
2. Stamp of Approval: IFC%s investment would provide the Company with greater credibility to pursue its growth, and give investors confidence in the event of an IPO.
3. Standard setting: IFC%s investment and partnership will promote higher standards of corporate governance for sustainable long term growth.
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