Mavesa Ecuador (IFC-46229)

Countries
  • Ecuador
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • International Finance Corporation (IFC)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Project Status
Proposed
Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Borrower
SPV OF MAVESA ECUADOR
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Industry and Trade
  • Transport
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Loan
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 50.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ IFC website

Updated in EWS Jul 21, 2022

Disclosed by Bank Jul 19, 2022

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

Founded in 1932, Maquinaria y Vehículos S.A. (“Mavesa” or the “Company”) is a family-owned, leading distributor of specialized vehicles such as buses, heavy-weight trucks, construction equipment, and light cargo vehicles utilized in multiple industries in the Ecuadorian market. Mavesa is the local distributor of (i) global vehicle manufacturers such as Hino (Toyota trucks), Citroën, DS Automobiles, Dongfeng, ZX Auto, Skywell among others; (ii) heavy equipment and machinery producers LiuGong and Bomag (Fayat Group); and (iii) Marangoni retreaded truck tires. Additionally, the Company owns and operates a network of 33 specialized vehicle shops and service centers across 12 cities, providing full after-sales services to customers.  The proposed transaction will be structured through a synthetic securitization of the Company’s loan portfolio originated from the provision of heavy-weight vehicle financing to its clients, to support Mavesa’s 2022-2023 growth plan which has a total cost of US$50 million and includes: (i) the purchase of electric vehicles (“EV”) and necessary investments in infrastructure and capacity building for US$18 million; and (ii) US$32 million for the working capital to finance the Company’s on-lending activities and growth post-COVID recovery. The Project would be funded by an up to US$50m IFC A/B Loan and, given Mavesa’s commitment to introducing EVs in Ecuador, the proposed transaction will be structured as a Sustainability Linked Loan (“SLL”).                                                  

Early Warning System Project Analysis
For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

While all Performance Standards are applicable to this investment, IFC’s environmental and social due diligence indicates that the investment will have impacts which must be managed in a manner consistent with the following Performance Standards

PS 1 - Assessment and Management of Environmental and Social Risks and Impacts
PS 2 - Labor and Working Conditions
PS 3 - Resource Efficiency and Pollution Prevention
PS 4 - Community Health, Safety and Security

- PS 5: Land Acquisition and Involuntary Resettlement: Project locations has been acquired on a willing seller willing buyer basis. According to the information provided by the company, no informal land users have been identified prior to land acquisition for new facilities and the existing facilities. As of May 2022, there have been no grievances or court cases related to the land acquisition and/or leasing. A potential land acquisition related risk is expected to be captured through the risk identification procedure.

- PS6: Biodiversity Conservation and Sustainable Management of Living Natural Resources: All land lots for the Project are in urban areas and impacts on biodiversity values are not anticipated.

- PS 7: Indigenous Peoples: No indigenous peoples were identified in the areas surrounding the company’s assets.

- PS 8: Cultural Heritage: The company’s assets do not overlap with World Heritage Sites and there is no known cultural heritage within the vicinity that can be affected.             

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

ACCESS TO INFORMATION

You can submit a request for information disclosure at: https://disclosures.ifc.org/#/inquiries

If you believe that your request for information from IFC has been unreasonably denied, or that this Policy has been interpreted incorrectly, you can submit a complaint at the link above to IFC's Access to Information Policy Advisor, who reports directly to IFC's Executive Vice President.

ACCOUNTABILITY MECHANISM OF IFC/MIGA

The Compliance Advisor Ombudsman (CAO) is the independent complaint mechanism and fact-finding body for people who believe they are likely to be, or have been, adversely affected by an IFC or MIGA- financed project. If you submit a complaint to the CAO, they may assist you in resolving a dispute with the company and/or investigate to assess whether the IFC is following its own policies and procedures for preventing harm to people or the environment. If you want to submit a complaint electronically, you can email the CAO at CAO@worldbankgroup.org You can learn more about the CAO and how to file a complaint at http://www.cao-ombudsman.org

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How it works