Company name
Compañía Cervecera de Nicaragua SA (CCN) and Compañía Recicladora de Nicaragua SA (CRN)
Project number
12597-01
Category B projects have potential environmental and/or social impacts and risks that are less adverse than those of a Category A and which are generally limited to the project site, largely reversible and can be mitigated via measures that are readily available and feasible to implement in the context of the operation.
E&S category
B
Country
Nicaragua
Sector
Manufacturing
Status
In implementation
Disclosed date
09/05/2019
Projected date at which a project will be put forward for the Board of Executive Directors’ approval.
Projected board date
10/29/2019
Approval date
12/12/2019
Signed date
03/27/2020
Sponsoring entity
N/A
Investment Operations Department Contact
Portfolio Management Division
Investment type
Syndicated amount
N/A
Financing amount
USD $ 30,000,000
Currency
USD
Project scope and objective
The IDB Invest loan will be used to (i) finance production line expansions in Compañía Cervecera de Nicaragua SA (CCN), (ii) improve and expand CCN infrastructure, (iii) acquire machinery from Compañía Recicladora de Nicaragua SA (CRN), (iv) expand CRN infrastructure, (v) as working capital and to finance the future growth of CCN and CRN.
The project comprises two secured loans for up to US$30 million, which are expected to consist of: (i) Loan I for CCN for a total of up to US$20 million; and (ii) Loan II for CRN for a total of up to US$ 10 million.
CCN has a strong market position; its financial results are satisfactory and consistent with its market position. Its senior management is successful and experienced, and its partners have extensive experience in the sector and play an important role in the Guatemalan and Costa Rican markets.
The transaction involves Inversiones Cerveceras Centroamericanas, SA (INCECA) as guarantor for both Loan I and II. CCN will additionally be a co-borrower in Loan II, given that CRN is still a small company and its operating cash flow and profitability are under development.
CCN is currently 99.7% a subsidiary of INCECA and leads the beer market in Nicaragua. It also sells the Heineken, Miller, Bliss, Sol, Mytos, Rubia and other imported brands. The vast majority of its beer sales revenue derives from its two own brands: Toña and Victoria. In 2017, INCECA decided to participate—through subsidiary companies in a commercial partnership with local and regional entrepreneurs—as a shareholder in the company Recicladora Nacional (RN), creating the new corporation CRN, which is 50% an indirect subsidiary of INCECA, the guarantor of the loans.
In 2009 and 2013, loans for US$7 million and US$5 million respectively were approved for CCN. In 2017, it was a Co-Borrower in the transaction with CDN, a distribution company that is part of the Group. On that occasion, the approved loan was for US$13 million, used to build a distribution center.
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Contact information
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Client Contact
N/A
PHONE NUMBER
N/A
POST OFFICE ADDRESS
N/A
IDB Invest Contact
requestinformation@idbinvest.org
PHONE
+1(202)-566-4566
ADDRESS
1350 New York Ave NW, Washington, DC 20005
COUNTRY OFFICES
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Environmental and social review
IDB Invest conducts an environmental and social due diligence (ESDD) commensurate with the nature, scale, and stage of the project, and with its level of environmental and social risks and impacts. The ESDD will confirm the project E&S categorization and assess the project with respect to the client requirements in IDB Invest Environmental and Social Sustainability Policy. The results of the ESDD, including any identified gaps are described in the Environmental and Social Review Summary (ESRS) provided below. For projects approved as of 2016, any gaps with respect to IDB Invest's Environmental and Social Sustainability Policy at the time of the ESDD are addressed in the Environmental and Social Action Plan (ESAP) presented below, to comply with the date mentioned above.
ENVIRONMENTAL AND SOCIAL REVIEW
114.3 Kb
CRN Y CCN ENVIRONMENTAL AND SOCIAL ACTION PLAN.PDF
107.9 Kb