IFC, CDP Support Italian Automotive Supplier CLN’s Expansion in South Africa

IFC, a member of the World Bank Group, and Cassa Depositi e Prestiti (CDP), Italy’s national promotional institution, today announced a loan of €134 million to support the international expansion of CLN Coils Lamiere Nastri Spa (CLN), a leading Italian automotive parts manufacturer. 

The financing package, which includes €84 million from IFC and €50 million from CDP, will primarily support CLN’s plans to modernize and expand local production of advanced automotive components for leading car manufacturers in South Africa. The project will boost South Africa’s automotive industry by increasing value addition through increased localization, introducing new production processes, and training local workers to participate in the international automobile value chain. 

“We are greatly honored to be part of this important investment plan, which will help our Group strengthen our position in South Africa as strategic supplier for the leading automotive industry,” said the CEO of CLN Group, G. Perris Magnetto. 

IFC Director for Southern Africa, Kevin Njiraini, said: “IFC’s investment in CLN is part of our broader approach to support the South African automotive industry through advisory and investment services. CLN’s expansion in South Africa will promote the competitiveness of the automotive industry, helping create jobs and livelihoods in the country.” 
  
IFC’s financing will consist of a €48 million from IFC’s own account and another €36 million loan through the IFC Managed Co-Lending Portfolio Program, a new syndications platform, which enables institutional investors to passively participate in IFC’s future senior loan portfolio. It represents IFC and CDP’s first transaction under the Master Cooperation Agreement, which aims to streamline lending procedures for joint investments to ease financing to private companies in emerging markets. 

The South African economy struggles with high unemployment. Automotive production represents the largest manufacturing sector in South Africa, and plays a central role in creating jobs and transferring knowledge and technology in the economy. IFC estimates that increasing the amount of locally produced content to 45 percent, up from the current 35 percent, could generate economic value of an additional $4 billion and support 80,000 more jobs. Success depends on the ability of local suppliers to build capacity to meet the demands of global automotive companies. 

About CLN

The CLN Group is a leading international player on the global market of metal forming and assembly of components for the automotive industry with its MA and MW divisions, and on the European market of steel cold rolling and distribution. MA, the automotive components division of CLN, is one of the main global suppliers of metal parts, stamped and roll-formed components, as well as welded parts, for any type of passenger car or commercial vehicle. MW, the steel wheels division, is a market leader in the sector of steel wheel manufacturing for all types of vehicles (passenger cars and light commercial vehicles). CLN Group is present in nine countries with 33 industrial facilities and employs approximately 7,500 people. In 2017, it registered a consolidated turnover of €1.6 billion. For more information: www.gruppocln.com 

About IFC 
IFC—a sister organization of the World Bank and member of the World Bank Group—is the largest global development institution focused on the private sector in emerging markets. We work with more than 2,000 businesses worldwide, using our capital, expertise, and influence to create markets and opportunities in the toughest areas of the world. In fiscal year 2018, we delivered more than $23 billion in long-term financing for developing countries, leveraging the power of the private sector to end extreme poverty and boost shared prosperity. For more information, visit www.ifc.org 

About CDP

CDP is the National Promotional Institution with a mission to support sustainable development and invest in competitiveness. Founded in 1850, CDP plays a key role in financing infrastructure and social&affordable housing and supporting enterprises’ growth and international expansions. Since 2016 CDP has also been recognized as the Italian Financial Institution for Development Cooperation. Within this broadened mission, CDP aims at promoting sustainable development, in Italy and abroad, accelerating the 2030 Agenda to achieve the SDGs. In order to fulfil its role, CDP acts as a catalyst of public and private sector investments, promotes the dialogue among stakeholders and identifies new strategies to sustain growth and employment.