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Summary of Project Information (SPI)

This Summary of Project Information is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only.
Project number21901
Project nameProcesadora Nacional de Alimentos C.A. - PRONACA
CountryEcuador
SectorAnimal Slaughtering and Processing
Department
Company nameProcesadora Nacional de Alimentos C.A. - PRONACA
Environmental categoryB
Date SPI disclosedMarch 3, 2004
Projected board dateApril 8, 2004
StatusActive
Previous EventsInvested: May 13, 2005
Signed: June 29, 2004
Approved: April 22, 2004

Description of company and purpose of project
Procesadora Nacional de Alimentos C.A.-PRONACA (Pronaca or the comany) is a fully-integrated poultry and pork processor. IFC will provide financing for Pronaca to construct a new distribution center in Guayaquil and expand storage facilities in its Quito distribution center; upgrade the environmental standards of its farms and slaughterhouses, refinance short-term debt; and acquire a local company in the packaged meats sector.

Project sponsor and major shareholders of project company
The project sponsor is Pronaca, a private company founded some 45 years ago. Pronaca currently commercializes leading brands such as Mr. Pollo (poultry), Mr. Chancho (pork), and Fritz (sausages). Pronaca is owned by private local investors. Pronaca owns and operates pork and broiler farms, hatcheries, processing plants, feed mills, and distribution centers across Ecuador. All the company’s food processing plants have HACCP quality assurance systems and certifications, which is the international standard for food safety.

Total project cost and proposed IFC investment

The total project cost is estimated at $50 million. The proposed IFC investment is a $20 million A Loan for IFC’s own account.

Location of project and description of site
The company’s poultry processing plants are located in Quito, Bucay and Valle Hermoso. The company also has a pork processing facility in Valle Hermoso, next to its poultry processing plant. The company’s distribution facilities are located in or around Ecuador’s main urban centers, primarily Guayaquil and Quito. The company’s feed mills are located in Puembo, Durán, and Quevedo. All the above facilities are located on or have good access to the main road. Farms and hatcheries are located in semi-rural areas for bio-security reasons. Pork and broiler farms are located near Santo Domingo de los Colorados. Additional broiler farms are located near Bucay and in the outskirts of Quito.

Project Development Impact and IFC's Role
Pronaca is the largest private employer in Ecuador. The project will allow Pronaca to increase distribution volume, thus generating significant benefits through linkages. Pronaca’s distribution of additional volumes and larger portfolio of products are expected to provide its more than 60 independent wholesale distributors with the opportunity to increase profits.

Pronaca has led the way in the sector in terms of progress towards compliance with pre-existing Ecuadorian regulatory requirements for wastewater management. Pronaca’s current investment to comply with stringent new regulations is expected to have a strong demonstration effect.

IFC will play a role in supporting a locally-owned company by providing long-term finance that is not readily available. IFC is providing technical expertise to assist Pronaca in its continuing efforts to reduce costs and further improve its environmental standards.

Environmental and social issues - Category B
This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result that can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project included a physical visit to selected, representative swine and poultry rearing facilities, principal slaughter and animal processing operations in Santo Domingo and Bucay, and an evaluation of technical and environmental/social information submitted by the project sponsor.

To view the environmental documents for this project, click here


Location of environmental documents in locally affected community
The ERS will be disclosed in the juntas parroquiales of the towns of Durán, Puembo, Valle Hermoso, and Bucay. The ERS will be available in the company’s administrative offices:
Quito:
Los Naranjos #4415 y Ave. De Los Granados
Phone: 226-3651
Guayaquil:
Centro Comercial El Terminal, Bloque F
Phone: 229-7100

Santo Domingo de los Colorados:
Avda. Tsáchila y Río Baba, frente al Monumento de Julio Jaramillo
Phone: 275-4857

Bucay:
Km. 2 1/2 vía Bucay Naranjito, Campamento Ave Guayas – PRONACA
Phone: 272-7266

To contact the project company, please write to:

Ms. Marcia Vaca, Directora Corporativa de Tesorería,
Los Naranjos #4415 y Ave.
De Los Granados, Casilla 17-17-1462,
Quito-ECUADOR.

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