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IDB Invest strengthens the aluminum industry in Mexico with financing to Arzyz Metals

IDB Invest, a member of the IDB Group, provided a $66.5 million financial package to Arzyz Metals to increase its production capacity of aluminum alloys through the construction and equipment of a new plant located in the municipality of Cienega de Flores in Nuevo Leon, Mexico. Arzyz Metals is one of the leading companies in the branch of aluminum manufacturing and the commercialization of non-ferrous metals for various industries in Mexico.

The financing will contribute to job creation in the construction and operation phases of the new plant, will enable employee training, improve the company's productivity and reinforce operations with its value chain, which is comprised largely of micro, small and medium-sized enterprises (MSME) providers.

The project includes investment in two production lines, in complementary equipment and in infrastructure to increase Arzyz Metals’ current production capacity. These will increase the efficiency of the aluminum recycling process and allow Arzyz Metals to meet part of the market demand not currently covered. This will help Arzyz Metals position itself as a leading local supplier, with shorter response times, especially for the automotive and mechanical industries.

The financial package has an eight-year tenor and consists of a $46.5 million IDB Invest loan and the mobilization of a $20 million loan from the China Co-financing Fund for Latin America and the Caribbean.

IDB Invest's participation in this operation promotes the circular economy through aluminum recycling. Arzyz Metals will obtain the maximum benefits of the recovered materials through more socially inclusive and environmentally sustainable solutions.

This deal is expected to potentially contribute to four of the United Nations Sustainable Development Goals (SDGs): Decent Work and Economic Growth (SDG 8), Industry, Innovation and Infrastructure (SDG 9), Responsible Consumption and Production (SDG 12) and Partnership for the Goals (OSD 17).

Support for manufacturing companies is essential for supporting employment and value chains, especially in the context of the health and economic emergency caused by COVID-19. Through this deal, IDB Invest supports the growth of the industry, particularly in one of the key sectors for sustainable development.

About IDB Invest

IDB Invest, a member of the IDB Group, is a multilateral development bank committed to promoting the economic development of its member countries in Latin America and the Caribbean through the private sector. IDB Invest finances sustainable companies and projects to achieve financial results and maximize economic, social and environmental development in the region. With a portfolio of $12.1 billion in asset management and 333 clients in 24 countries, IDB Invest provides innovative financial solutions and advisory services that meet the needs of its clients in a variety of industries.

About Arzyz Metals

Arzyz Metals is a Mexican company, founded in 1980 and whose main activity is the manufacturing of aluminum alloys and the commercialization of non-ferrous metals for different sectors of the industry. The industries that Arzyz Metals serves are primarily automotive, energy, construction and steel. The company focuses on scrap collection, manufacturing, marketing of primary metals and alloys, as well as the recovery of by-products.