IFC Global Telecoms, Media and Technology. June 2012

Transcription

1 IFC Global Telecoms, Media and Technology June 2012

2 IFC Overview IFC is the member of the World Bank Group focused on the private sector Founded in 1956 with 182 member countries Largest multilateral source of loan/equity financing in Emerging Markets Over $97 Billion Invested Since 1956 AAA-rated by S&P and Moody s Equity, quasi-equity, loans, risk management and local currency products Takes market risk with no sovereign guarantees Promoter of environmental, social, and corporate governance standards Resources and know-how of a global development bank with the flexibility of a merchant bank Holds equity in over 722 companies worldwide across the following sectors: -Agriculture -Manufacturing Service -Infrastructure -Telecoms, Media & Technology -Financial Markets -Health & Education -Oil, Gas and Mining 2

3 IFC Investments Across All Sectors Total Portfolio Committed in 2011 Mobilized (3 rd parties) IFC FY2011 Highlights $42.8 billion $12.2 billion $6.5 billion Europe & Central Asia 26% Sub-Saharan Africa 14% Middle East & N.Africa 11% Global 1% South Asia 10% # of Companies 1,737 # of Countries 127 East Asia and the Pacific 14% Latin America 24% 3

4 The World Bank and IFC Work Together World Bank TMT Policy Team IFC TMT Team Works with Governments to facilitate: Investment climate policies Legal and regulatory policies Media best practice guidelines Selective PPPs Works with Private Companies to ensure: Sound Economic fundamentals Sufficient Financial Strength Sensitivity to the Community Profitable Investments 4

5 IFC Financing in TMT Telecoms Media Technology Satelitte Infrastructure Data Centers Submarine Cable Applications e/m Payments Systems Wireless/Cellular Content Information Security Fiber Backbones Incubators IT Enabled Services Broadband Hardware/Devices Managed Services Towers Cross Cutting Venture Investments Greenfield Projects to Corporate Expansions 5

6 IFC Investments Across TMT Commitments by Sub-Sector Total Invested Committed in FY 2011 Mobilized in FY 2011 (3 rd parties) IFC Highlights $6.5 billion $337.2 million $562 million # of Countries 69 6

7 Supporting Development Through TMT Investments IFC s support of the telecoms, media and tech industry helps raise living standards for people throughout the developing world O3B- IFC led a group of development institutions in providing $260 million in financing to help O3b Networks Ltd complete a satellite system that will provide affordable broadband access to developing countries near the equator. Zain Iraq- IFC supported economic growth and expanded access to telecommunications services in Iraq through a landmark $400 million facility for Zain Iraq, the country s largest mobile phone operator, providing telecoms to people of Iraq for the first time in history of the country. Vodafone Ghana IFC led a group of development institutions and commercial banks in providing $215 million in financing to a mobile operator in Ghana. Through the project, IFC is supporting the successful privatization of the incumbent telecommunication company in Ghana, thereby helping to liberalize the market and promote the much needed competition that would help extend services to the bottom of the pyramid. IHS Towers- IFC provided $39 million in equity financing to a tower company in Nigeria. Through the project,ifc helped the development of low-cost models for accelerating the extension of telecommunications services to previously underserved areas and for the roll out of affordable broadband wireless services. 7

8 Award Winning Recognition from the Marketplace Altobridge : World Economic Forum Technology Pioneer; WSJ Technology Innovation Award Fino : 2011 Young Global Leader Award by World Economic Forum; 2011 Skoch Financial Inclusion Award; 2011 Sankalp Awards; 2011 CFO 100 Roll of Honor By CFO India magazine; 2010 Manthan South Asia Award for Best Project in the category e-inclusion: Financial Inclusion at the Bottom of the Pyramid through use of Technology; 2010 Asia Insurance Review Awards: Technology Initiative of the Year; e-india 2010 Awards recognizing excellence in ICT; 2009 Financial Times Sustainable Banking international award Voxiva 2011 Department of Health and Human Services (HHS) Innovation Award; 2011 Public Relations Society of America Silver Anvil: text4baby; 2011 Fast Company Magazine: #40 Most Innovative Company in the world; 2011 #3 Most Innovative in Mobile and Healthcare; 2008 Technology in Government in Africa (TIGA) award; 2007 Legatum FORTUNE Technology Prize: Finalist and Technology in Government in Africa (TIGA) award Yellow Pepper: Short-listed for the 2011 Achievement in Basic Needs Financing Category at Financial Times' and IFC Sustainable Banking Awards; 2010 The Inter-American Development Bank (IDB) Utilizing new information and communication technologies - connect Banking award; 2010 "CP Capital Inflection Venture Prize" during the Americas Venture Capital Conference Suvidhaa: 2011 Inclusive Business Leader Award; 2011 SKOCH Financial Inclusion Award; 2010 Skoch Virtual Corporation Award; 2010 Red Herring 100 Asia Award; 2009 ICAI Business Achiever award; 2008 Kutch Shakti National Award ; 2007 Girnar Award O3B: 2010 African Infra deal of the year by Project Finance magazine Project Finance International Avea: 2008 Trade Finance Magazine Deal of the Year 8

9 Global Expertise 9

10 How We Finance TMT Projects Investment Type IFC Investment Greenfield, total cost less than $50 million Greenfield, total cost more than $50 million Expansion or Rehabilitation Ability to mobilize funding from Banks, DFIs and PE funds Up to 35% of incremental investment Up to 25% of incremental investment cost for IFC s account Up to 50% of incremental investment cost Mobilization of 3 rd financing Total funding for own account cannot exceed 25% of total capitalization (debt plus equity) Umbrella for participants in IFC s syndication program: IFC lender of record, immunity from taxation and provisioning requirements. 10

11 Financial Products - Equity to Debt Equity Private Equity (including Venture Capital) Typically 5-20% shareholding Long-term investor, typically 4-8 year holding period Not just financial investor, adding to shareholder value Board position on case by case basis Subordinated loans Income participating loans Convertibles Other hybrid instruments Mezzanine/Quasi Equity Subordinated loans Income participating loans Convertibles Other hybrid instruments 11

12 Financial Products - From Equity to Debt Senior Debt & Equivalents Senior Debt: Project Finance or Corporate Finance Fixed/floating rates, US$, Euro and some local currencies Commercial rates, repayment tailored to project/company needs Long maturities: up to 15 years, appropriate grace periods Range of security packages suited to project/country Islamic Financing alternatives available Mobilization of funds from other lenders and investors; 1. through IFC s B loan Syndication Program loan arranger role, 2. arranging parallel financing from other banks and Development Finance Institutions Currency & Interest Rate Swaps Caps, Collars, and Currency Derivatives Commodity Derivatives Risk Management 12

13 Mobilizing Financing - Syndication B-Loan Structure Loan Agreement Participation Agreement IFC B Loan Participants A + B Loans A loan is for IFC s own account Borrower B loan is for account of participant foreign commercial banks Only one loan agreement, signed by the borrower and IFC IFC is the lender of record for the entire facility (A loan+b loan) Structure allows participants to benefit from IFC privileges and immunities Better pricing/tenors than otherwise available; preferred creditor access to foreign exchange IFC Loans exempt from withholding taxes 13

14 Mobilizing Financing Parallel Loan/Agency Role Common Terms Agmt (CTA) IFC Facility Agent Agmt A, B & Parallel Loan Funds Borrower Agency Agmt Common Terms Agmt Parallel Loan Funds Parallel Lenders CTA & Loan Agreements Parallel loan is for Lender s own account Parallel loan funds and repayments flow through IFC Agency Agreement between borrower, IFC and parallel lenders for administration of loans Common Terms Agreement harmonizes disbursements conditions, covenants EODs amongst lenders IFC and Parallel lenders retain own loan agreements directly with borrower One point of interface for borrower, simplification of communication, funds flows, general administration of loans 14

15 IFC s Investment Process Concept Review Appraisal/Due Negotiation Diligence IFC mgmt approval & Disclosure Commitment and Disbursement Portfolio Management Client needs determined Assessment of project s impacts and development contributions Policy Committee approval Mandate letter ID & initial assessment of business, technical, legal & enviro/social opps and risks Appraisal Complete analysis of opps and risks Negotiation and agreement of principal terms IFC mgmt approval Disclosure of environmental and social information Opportunity for public comment Drafting & negotiation of legal documents Board approval Signing of legal documents Disbursement Annual & quarterly review of operational & financial performance Processing of waivers & amendments Board representation (if applicable) B-loan & parallel loan administration We Agree on a Specific Timeline to Meet Client s Needs 15

16 We Agree on a Specific Timeline to Meet Client s Needs Project Investment:$70M (Senior $10/Mezz $60) I.8% (penny warrants) shareholding Mobilization: $190M (Senior 105/Mezz $85) Completed in 8 Months April 11 May 11 Sept - Oct 11 November 11 Current Concept Review Mandate Letter Appraisal Credit Approval IFC Board Approval Financial Closure Commitment and Mezzanine Disbursement Monitoring Time line depends on company s support in providing information 16