Loan syndications: case studies 2017

Early Transition Countries (ETC)

MAGTICOM, Georgia

A loan agreement for USD 40 million was signed with MagtiCom Ltd, a leading telecommunications group in Georgia to support the company’s expansion.  FMO participated as B lender with USD 10 million.

MagtiCom is a leading telecoms operator in Georgia and the only triple play operator providing a range of services including mobile, IPTV and internet.  It has the most extensive mobile voice and broadband coverage in the country and the fastest mobile broadband network.   Since its inception in 1996, MagtiCom has played a major role in the development of networks such as GPRS in 2001, 3G network in 2006, satellite broadcasting in 2012, and 4G/LTE network in 2015. The Company recently won a license for the 4.5G network in Georgia.

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ENA, Armenia

A USD 80 million A/B loan was signed with Electric Networks of Armenia (“ENA”), with FMO acting as B lender with USD 10 million to finance a 5-year (2016-20) USD 200 million investment programme for the modernisation of the distribution network, including the introduction of smart metering across Armenia.

The funds will be used for the modernisation of substations and lines, installation of smart meters as well as expansion of the automated electricity metering system, expansion of the network and new connections.  This will help address the problem of high technical losses and poor reliability performance with frequent and long power cuts and black-outs.

ENA is an electricity transmission and distribution company in Armenia, fully owned by the Russian Tashir Group.  It owns and operates all distribution networks in Armenia up to 110kV voltage.  ENA also distributes and supplies electricity to all industrial and retail clients in the country.

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XACBANK, Mongolia

EBRD arranged a senior USD 40 million loan, out of which USD 30 million was syndicated to impact investment funds and a commercial bank.

The proceeds will be used for financing of private micro, small and medium-sized enterprises (MSMEs) around the country.  The loan will help XacBank expand in the growing MSME segment.

XacBank is the fourth largest bank in Mongolia and is a leading provider of micro loans in the country.

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Power & Energy, renewables

BENBAN, Egypt

The EBRD, the Green Climate Fund (GCF), the Islamic Development Bank (IsDB), the Islamic Corporation for the Development of the Private Sector (ICD) and the Dutch development bank FMO are providing loans totaling USD 335 million to support the Norwegian developer Scatec Solar and its partners in the construction of a portfolio of six 50 MWAC solar plants at the Benban Complex in Upper Egypt.  Upon completion, the Benban Complex is projected to become the largest solar installation in Africa, with a planned total capacity of 1.8 GW.

The EBRD is providing loans of USD 235 million, of which USD 72 million is being provided by FMO on a B loan, syndicated basis, whilst USD 48 million is provided by the GCF.  In addition, IsDB will extend USD 75 million and ICD USD 25 million.

These projects are part of the EBRD's new USD 500 million framework for renewable energy in Egypt, which is expected to finance a total of 16 projects delivering 750 MW of capacity.

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AL SAFAWI, Jordan

EBRD signed an A/B loan of USD 65 million in support of a USD 93 million solar energy project sponsored by Al–Safawi for Green Energy PSC, a special purpose entity incorporated in Jordan.  FMO supported the financing as B lender with a participation of USD 33.3 million.

The 51MW photovoltaic power plant will exploit Jordan’s solar resource to deliver much-needed generating capacity, reduce its import dependence and lower the carbon intensity of its power sector.  It will be one of the largest privately owned utility scale photovoltaic projects in Jordan and will serve as a model in demonstrating how private sector capital and expertise can be mobilised to implement such projects and yield competitively low tariffs.

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SHOBAK WIND FARM, Jordan

A USD 52 million loan agreement was signed with Shobak Wind Farm Energy PSC, a Jordanian SPV 90% owned by Alcazar Energy Partners and 10% by Hecate Energy LLC.  EBRD provided USD 26 million, with Europe Arab Bank providing the remaining USD 26 million under the A/B loan structure.  The funds will be used to develop, construct and operate a 45 MW wind farm located in the Shobak area, south of Jordan.

Alcazar Energy Partners is a power plant developer and operator focused on renewable energy across the Middle East, Turkey and Africa, with an emphasis on photovoltaic and onshore wind technologies.

Hecate Energy LLC is a US-based international developer of energy projects, operating c. 2000 MW installed capacity across 37 projects mainly in the United States, but also in Jordan, Pakistan, Tanzania and Kenya.

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CEDIS, Montenegro

The EBRD’s first A/B loan in Montenegro supported the modernisation of the recently unbundled electricity distribution network with a EUR 32 million loan to Crnogorski elektrodistributivni system d.o.o. Podgorica.  The loan will be used to modernise and/or replacement of existing low voltage infrastructure, update the control systems and to the purchase and install 60,000 smart meters.

Erste Croatia acquired a EUR 13.5 million participation in the transaction.

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Agribusiness

NIBULON, Ukraine

EBRD signed a USD 90 million A/B loan, with USD 71 million in B loans provided by ABN Amro, BNP Paribas, Credit Agricole, ING and Rabobank for a structured working capital facility with Nibulon SA.

Nibulon Group is a leading Ukrainian integrated grain/oilseeds exporter and producer, operating 25 in-land and river silos with an overall capacity of 1.6 million tons of grain and a grain transhipment terminal in Nikolaev.  It is the only Ukrainian agribusiness commodity company with its own rover fleet (barges and tag-boats) to be able to export grain by river.  It also has its own agricultural division farming ca. 82,500 ha of farm land across 11 regions of Ukraine.

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PEYMAN, Turkey

EBRD signed a EUR 32 million A/B loan with Turkish Peyman Kuruyemiş Gida Aktariye Kimyevi Maddeler Tarim Űrünleri Sanayi vi Ticaret A.Ş. (“Peyman”), the second largest producer of dried fruits, nuts and seeds in Turkey. 

The loan will be used to finance (i) the implementation of the Peyman’s investment programme relating to the construction of a new production facility in the Eskişehir industrial zone in Central Anatolia, (ii) certain other capital expenditures, and (iii) permanent working capital requirements to support growth linked to the capex investments.

FMO participated as B lender with a EUR 10 million ticket. 

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SCHWARZ GROUP, Romania and Bulgaria

EBRD provided EUR 170 million across two loans to the German retail group Schwarz, to finance the expansion of Lidl’s operations in Bulgaria and Romania, funding the roll-out of the new green stores, distribution centres and office buildings designed to a high sustainability standard.  The loans added up to EUR 100 million A loan for EBRD’s own account, with B loans amounting to EUR 70 million syndicated to Intesa Sanpaolo and Raiffeisen Bank International.

Schwarz is the leading retailer in Europe.  The Group is present in 28 European countries, with two formats: Lidl – discount food retail and Kaufland.

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Turkish Hospitals

BURSA HOSPITAL PPP, Turkey

A EUR 135 million EBRD A/B loan facility to support the c. EUR 500 million Bursa Hospital PPP project, comprising an A loan of EUR 55 million provided by EBRD, and a B loan of EUR 80 million, syndicated to MUFG, Kommunalkredit and Industrial and Commercial Bank of China, with EUR 20 million of additional parallel financing provided by DEG.

Bursa is the 8th project signed under the EBRD’s Turkish Hospital PPP framework.

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Bilkent Lab PPP

The EBRD is providing a EUR 124.5 million A/B Loan as part of an overall debt facility of ca  EUR 500 million to support a EUR 711 million investment by CCN Holding to establish an integrated hospital laboratories campus in Turkey pursuant to a concession agreement reached with Turkey’s Ministry of Health under the country’s Hospital PPP Programme.  The 15 year EBRD B Loan of EUR 49.5 million was provided by Siemens Bank and Unicredit.

The remaining debt is being provided by other lenders including IDB, BSTDB, ECO Trade and Development Bank, Austrian Development Bank and Turkey’s Finansbank.

This was the 9th project signed under the EBRD’s Turkish Hospital PPP framework.

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Greece

COSMOTE, Greece

A EUR 150 million unsecured A/B loan was signed with Cosmote Mobile Telecommunications S.A.  The loan is split between EUR 85 million A loan for the account of EBRD, and a EUR 65 million B loan for the account of commercial lenders.  The proceeds of the loan will be used to finance Cosmote’s mobile network and other capex, including energy efficiency projects.

The B loan attracted 10 commercial banks: Eurobank, National Bank of Greece, Raiffeisen Bank International, Bank of China Luxembourg, Industrial & Commercial Bank of China Luxembourg, Intesa Sanpaolo, Hellenic Bank, Piraeus Bank and Nomura Bank International.

Cosmote is the mobile telecommunications arm of OTE Group and has subsidiaries in Albania and Romania.  The borrower is the largest mobile network operator and leader in the mobile telecommunications market in Greece, where it was the first operator to roll out 3G, 4G and 4G+ mobile services.  Cosmote has continuously acted as the leading investor in new technologies, maintaining network superiority in terms of coverage, data speeds and the expansion of the 4G footprint.

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Kazakhstan

SHALKIYA ZINC, Kazakhstan

USD 295 million pre-privatization A/B senior loan to JSC Shalkiya Zinc Ltd, a fully owned subsidiary of Tau-Ken Samruk (“TKS”), itself fully owned by Samruk-Kazyna National Wealth Fund of Kazakhstan. The USD 120 million B Loan was contributed by Bank of China.

TKS is a mining company established in 2009 to consolidate state-owned assets in the mining sector. TKS currently have nine exploration stage projects in gold, copper, iron and zinc/lead sub-sectors and also owns three development projects for polymetallic and iron ores, including Shalkiya Zinc Ltd.  TKS also built and operates a gold refinery plant near Astana, a metallurgical silicon production plant in Karaganda and a quartz mine in the Zhezkazgan region. 

The loan will finance the placing into operation and expansion of the Skalkiya zinc-lead mine located in the Kyzylorda region of Kazakhstan.  This includes the construction of an on-site processing plant with an annual capacity of four million tonnes.

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Ukraine

ArcelorMittal Kryvyi Rih, Ukraine

The EBRD is providing a USD 175 million unsecured A/B loan to support the modernization of Ukraine’s largest steel mill, PubJSC ArcelorMittal Kryvyi Rih who is owned by global steel maker ArcelorMittal.

The loan is helping to finance investments focusing on improvement of competitiveness, energy efficiency and environmental performance worth USD 1 billion at the mill and represents the largest private sector investment programme in Ukraine in recent years. The investments will not increase production capacity.  The project will reduce the borrower’s CO₂ emissions and will reduce dust emissions from a current 14,700 tonnes per year to about 3,000 tonnes per year, as well as other emissions incl. nitrogen oxide.

The Loan is split between a USD 90 million A loan for the account of EBRD and a USD 85 million B loan for the account of Credit Agricole, Raiffeisen Bank International, AKA Ausfuhrkredit-GmbH, Hellenic Bank (Cyprus) and Federated Project and Trade Finance Core Fund. The Loan is fully guaranteed by the parent, AMSA.

Further information

The EBRD also signed a substantial syndicated loan with a relatively large number of B lenders in Ukraine with agribusiness company Nibulon, mentioned in the Agribusiness section.