Mexmal

completed

Groupo Mexmal provides components for computer systems, systems design services, and technical assistance and training to value added resellers (VARs) and systems integrators in Mexico, and works with them on the joint development of higher value added solutions. Mexmal also offers connectivity solutions, including Internet access. The company is planning to expand its operations into Mexico City, which would constitute the primary use of funds for this project. The expansion comprises leasing additional space, and increasing working capital requirements (inventory and accounts receivable). Mexmal’s working capital needs for its existing businesses would also increase as the business expands and the company moves into higher value added components. Development ImpactThe project would have significant developmental impact by creating IT related jobs in Mexico, and providing low-cost computer solutions to schools, small and mediume enterprises and less wealthy sections of the population. In addition, Mexmal’s support to local VARs would increase the technical know-how available throughout the country. IFC’s RoleThe economic turndown and the decline of appetite for technology investments by private equity investors has made it extremely difficult for mid-sized companies such as Mexmal to raise long-term capital. The IFC funding is, therefore, critical to the company’s expansion plans.IFC’s presence would provide Mexmal with the credibility it needs to attract investors in future rounds of funding. IFC would also assist the company in obtaining needed credit facilities. Moreover, IFC would play a major role in enhancing the Mexmal’s corporate governance practices and assisting in its transformation from an entrepreneur-owned company to a professionally managed company with international best practice.