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EBRD loan to modernise textile factory in Slovenia
A bankrupt Slovenian state textile company will be revitalised by a loan signed yesterday in Kranj, Slovenia, between the European Bank for Reconstruction and Development (EBRD) and Aquasava d.o.o., a company incorporated in Slovenia and majority owned by Italy's La Torre Finanziaria, the operating company of Bonazzi Group.
Ron Freeman, First Vice President of the EBRD, said: "This project will put back into work 430 experienced Slovenian textile workers. It will also give a boost to textile exports, maintaining a historically important industry in Slovenia and earning hard currency for the country."
The DM 9.1 million (ECU 4.8 million equivalent) EBRD loan, the first for the Bank in the Slovenian private industrial sector, will allow Aquasava to establish a modern cotton, polyester, and nylon processing operation in Kranj, north of Ljubljana, for export to Italy and western Europe. The company's products - medium weight cotton fabrics, nylon carpet yarn and polyester lining - will be purchased mainly by subsidiaries of the Bonazzi Group which specialise in the respective textiles.
The total project cost is DM 26 million, including equity and debt. The minority shareholder of Aquasava is Textilind, a subsidiary of a Slovenian bank, Gorenjska Banca. Long-term debt financing will be provided, in addition to the EBRD, by the Mediocredito Centrale.
As a condition for receiving EBRD financing, Aquasava will address certain environmental aspects, which include installing an equalising storage tank for waste water and modernising the chemicals storage facility. Measures to mitigate any problems of potential soil and ground water contamination will also be undertaken. The company is also obliged to submit to the Bank an annual report on environmental and worker health and safety matters relating to the project.
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