The EBRD is making its first equity investment in a private Romanian corporation in a transaction that will boost the competitiveness and market position of the country's largest producer of tissue paper and household tissue paper products.
The injection of €6 million of new capital into Pehart Tec will support the company's drive to increase its production of tissue products by offering a high-quality alternative to more expensive imports.
The company will use the funding to increase export opportunities throughout the region, help to increase production volumes and introduce a range of new value-added products.
As the fifth largest tissue paper consumer in eastern Europe, Romania currently imports over 30 percent of consumed tissue, while a quarter of the domestic production is export oriented.
Pehart Tec is located in the north-west of Romania, in Petresti, near Alba Iulia, and is part of the MG Tec Group.
The company will also use the EBRD proceeds to finance energy efficiency investments that will make the plant around 80 per cent self sufficient in electricity, reducing its overall energy costs significantly, by more than €1.5 million annually.
This first equity investment in a private Romanian company demonstrates the EBRD’s willingness to provide new capital to well-run private businesses in Romania.
“The EBRD is pleased to become a shareholder in this successful Romanian company which is setting new and higher standards in the Romanian tissue paper industry. Supporting well managed local Romanian companies is a priority for the EBRD”, said Claudia Pendred, Director of the EBRD office in Romania.
”We welcome the EBRD investment which complements an investment programme of over €26 million initiated by Pehart Tec, a member of MG Tec Group SA”, said Ioan Tecar, President of MG Tec Group SA.
To date the EBRD has committed over €4.2 billion to more than 250 projects in Romania in the corporate, financial, energy and infrastructure sectors.