- €10 million loan for Croatian wood producer, a subsidiary of Italy’s Florian Group
- Funds to finance investments into resource efficiency and expansion
- Wood processing is a key sector of the Croatian economy
Croatia’s real economy will benefit from a joint €10 million loan to the wood producer Lipovljani Lignum d.o.o. provided by the EBRD and the Enterprise Expansion Fund (ENEF). Lipovljani Lignum is a subsidiary of Florian Group, the privately-owned European leader in wood-based panels.
Wood processing is a key sector of the Croatian economy, and the country has a long-standing tradition of wood processing based on natural resources and expertise.
The EBRD and ENEF funds will finance investments into resource efficiency improvements through the construction of a pellet plant that will recycle residues of hardwood processing at facilities of DI Novoselec d.o.o., a subsidiary of Lipovljani Lignum. The funds will also support the company’s move towards more value-added production through investments into flooring and further expansion in Croatia.
With their investment, the EBRD and ENEF support the sustainable financing and implementation of resource efficiency with a positive impact on the environment, as pellet usage contributes to a significant avoidance of CO2 emissions. In addition, Florian Group has committed to corporate governance measures.
After entering the Croatian market in 1994, Florian Group has been highly active and has seen its strongest growth in the country, currently employing 820 people across five production sites. The Group engages in the whole process chain from primary processing and saw milling to the manufacture of a wide range of products from panels to flooring and furniture. Apart from Croatia, Florian Group also has subsidiaries in France and Hungary. In the process, Florian Group was supported by financial advisor InterCapital Securities, Zagreb and industrial advisor Lavorenti&Associati.
Victoria Zinchuk, EBRD Director for Croatia, said: “We are very happy to support this innovative project that will transform wood residue into biomass to be used as a source of energy. It is a very good example of a circular economy approach in the wood processing industry focused on the reduction of waste and the increase of the recyclability of products”.
Elvio and Stefano Florian added: “This transaction provides a boost to our Croatian business, allowing us to reduce waste and increase the efficiency of our production process. At the same time, we are proud that EBRD believes in us by financing our initiatives, which are devoted to sustainability and better material utilisation, respecting wood as a fundamental resource in human life.”
To date, the EBRD has invested €3.8 billion in Croatia through 207 projects. Support of the real economy by strengthening the competitiveness of private businesses is one of the Bank’s priorities in the country.