IFC Facilitates $176M Financing Package to Recaudo Bogota to Overhaul Bogota’s Transit System
Washington, D.C. — IFC, a member of the World Bank Group, has facilitated a $176 million financing package to Recaudo Bogota S.A.S to develop and operate the fare collection, fleet management, and real-time information technology system for Bogota’s bus Integrated Public Transportation System (SITP). The financing will improve the Colombian capital’s capacity to manage its large transportation needs, helping serve 6 million bus passengers daily and making public transportation more affordable and convenient in Latin America’s sixth largest city. It will also create 2,500 new jobs.
IFC will provide a 12-year loan of $55 million. Korea Exim Bank (KEXIM) will provide $62 million, and will guarantee a $59 million commercial bank loan facility provided by HSBC, Shinhan Bank, and Woori Bank.
Recaudo Bogota is a newly created company that won a concession contract from the City of Bogota in 2011 to manage the program for 16 years. The loan package will allow Recaudo Bogota to more effectively coordinate a complex system of over 12,000 buses running 500-plus routes operated by 13 companies.
“We are proud to have IFC as a long-term financial partner,” said Pedro Ruano, President of the Board of Directors of Recaudo Bogota. “With the loan comes great added value: An experienced team whose advice and commitment will be of great significance. IFC has been instrumental in facilitating a financial partnership where multilateral and Korean public and private banks work hand-in-hand with Korean and regional private companies to positively impact the vast majority of Bogota’s population.”
The international financing package is the largest in the history of Bogota’s public transportation. It is also IFC’s first loan to a transport payment system, drawing on IFC’s expertise in both public transit and electronic payment sectors. It will enable Recaudo Bogota, among other things, to introduce an easy-to-use electronic-payment mechanism using smartcards that will eliminate cash from the system, increasing security and efficiency. The company will distribute 2.7 million smartcards for free to low-income people.
“With this financing, IFC shows its commitment to continue supporting the effective participation of private sector players in improving public services in Colombia, in particular public transportation that benefits the quality of life of millions of people,” said Bernard Sheahan, IFC Vice President for Latin America and the Caribbean, Sub-Saharan Africa and Western Europe. “We are proud to partner with Recaudo Bogota, a company with the necessary technology and operational experience to succeed.”
LG CNS, a Korean services company and subsidiary of the LG Group, will be responsible for providing the most advanced information technology solutions of its kind to Recaudo Bogota, representing Korea’s largest ever information-technology services export. This will leverage the technology implemented in Seoul’s public transport system to develop a custom solution that meets Bogota’s fare collection, fleet management, and user-information needs.
IFC, a member of the World Bank Group, is the largest global development institution focused exclusively on the private sector. We help developing countries achieve sustainable growth by financing investment, mobilizing capital in international financial markets, and providing advisory services to businesses and governments. In FY12, our investments reached an all-time high of more than $20 billion, leveraging the power of the private sector to create jobs, spark innovation, and tackle the world’s most pressing development challenges. For more information, visit www.ifc.org.
About Recaudo Bogota
Recaudo Bogota S.A.S. is a Colombian private company implementing and operating the fare collection, fleet management, and user-information systems (SIRCI) for urban transportation and services. The company is constituted by Colombian entrepreneurs, and global leaders such as LGCNS Corp Ltd from Korea and regional leaders as Citymovil Colombia, a subsidiary of a Chilean company focused on fleet management and programming optimization for transport and logistics companies.
This news content was configured by WebWire editorial staff. Linking is permitted.