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EBRD lends $12 million to Ukrainian Glass producer
The European Bank for Reconstruction and Development will lend $12 million to Gostomel Glass Factory, the oldest and largest glass-container producer in Ukraine, supplying a wide range of local and international beverage, food processing and pharmaceutical companies.
The long-term financing will be used to refurbish and replace Gostomel's production facilities, help implement international accounting standards (IAS) and meet the ISO 9000 certification standard. The loan is convertible into equity, making it the EBRD's first convertible loan in Ukraine.
Hans Christian Jacobsen, the EBRD's Director for Agribusiness, said the deal is important because it demonstrates that long-term financing is available to Ukrainian companies with a purely local shareholder base, even without a foreign sponsor's participation. With the Bank's already active involvement in Ukraine's beer market, this deal is complementary because it will ensure that bottles for the expanding sector are of international quality, he said.
Pavlo Rybytskiy, Director of Gostomel Glass Factory, said the loan from the EBRD is vital at a time when Gostomel is trying to secure its leading position in the Ukrainian glass-packaging market and attract the interest of major international companies. "This long-term financing is very important because it will give us enough time to upgrade our operating standards to international level," Mr Rybytskiy said.
Technical cooperation funding from the governments of Taipei China and Germany helped prepare the project and greatly contributed to success of the deal.
Across the region, the EBRD has signed 150 investments in the agribusiness sector totalling more than €2.5 billion. In Ukraine, the EBRD's cumulative investment stands at €1.4 billion through 41 projects.
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