Guodong Tower

completed

The proposed project is a loan investment in Guodong Network Communication Group Co. Ltd. (“Guodong” or “the company”) of up to US$99 million, to support the company’s tower construction business expansion in nine provinces in China (Gansu, Guangxi, Guizhou, Hainan, Heilongjiang, Henan, Qinghai, Sichuan, and Yunnan ) (“the project”). The investment will comprise an IFC A loan of up to US$40 million, a mobilized loan through IFC’s Managed Co-Lending Portfolio Program (“MCPP”) of up to US$39 million, and a mobilized loan of up to US$20 million by parallel/B lenders. The company is the largest private independent telecommunications (“telecom”) tower company in China, with around 20,000 installed tower sites in 30 provinces in China as of June 30, 2020. The company: (i) assembles telecom towers at its plant located in the Qidong Economic Development Zone, in Nantong City, Jiangsu province, which started operations in 2015; (ii) identifies suitable tower locations in China and enters into long term leases with land-use-right holders of suitable land plots on which towers are then constructed; and (iii) once constructed, rents out towers to mobile-network-operator (“MNO”) client companies, which includes a service package of: (i) rental of tower space (to mount the MNOs’ telecom transmission and related equipment, which is owned and operated by MNO client companies and not by Guodong); (ii) tower maintenance service; and (iii) arranging for power provision to the tower-mounted equipment of MNO’s (Note: such power consumption materializes in telecom equipment owned and operated by Guodong’s MNO clients and not by Guodong). The company’s Nantong assembly plant, where core operational activities include welding, galvanization, and metal surface preparation, is not intended for utilization of IFC’s investment proceeds. The proposed IFC financing will contribute to supporting tower infrastructure in China.