The Inter-American Development Bank today announced the approval of a $100 million guarantee of $200 million senior, five-year, unsecured notes to be issued by Light-Serviços de Electricidade S.A. to help finance its investment program to improve electric service and coverage in the state of Rio de Janeiro, Brazil.
The operation is the second IDB guarantee for Brazil's private sector and the first by the Bank that guarantees unsecured notes. The guaranteed notes are expected to be purchased by commercial banks in the United States and other industrial countries.
The Multilateral Investment Guarantee Agency and other insurers are expected to guarantee the remaining $100 million of the notes.
The IDB guarantee will cover risks associated with currency convertibility, transferability, and funds expropriation.
The Light investment program includes connections with approximately 130,000 new customers, modernization of equipment and facilities, and the raising of standards, including environmental protection and safety.