The EBRD and Rusnano, the Russian state corporation set up to kick-start the development of innovative technologies, today jointly agreed to finance a new production line that will manufacture energy-saving glass.
The industrial partners in this project, which will use state-of-the-art technology to launch a new float glass line and glass coating facility in the Moscow region, are Japan’s publicly listed NSG Group -- Nippon Sheet Glass Co. Ltd. <5202:TYO>, a global leader in the glass industry, -- and the privately-owned STiS processing group, Russia’s leading producer of insulated glass units.
Under the terms of today’s agreement, the EBRD will contribute the equivalent of EUR 35 million in common equity while Rusnano will contribute the rouble equivalent of EUR 70 million in common equity.
The rest of the project financing will come from other sources and financial instruments, including the rouble equivalent of EUR 80 million from Rusnano. Total financing for this project is forecast to reach the rouble equivalent of EUR 295 million. Other financial details were not disclosed.
This is the first equity investment made by the EBRD with Rusnano and follows up on a Memorandum of Understanding on co-financing opportunities signed between the two institutions in December 2009. The Bank then expressed readiness to invest between EUR 500 million and EUR 1 billion over the medium term in Russia’s high-tech sector.
“Today’s agreement demonstrates the common goal that the EBRD and Rusnano have in supporting innovation in Russia by sharing investment risk in the development of new products and technologies,” the EBRD’s Managing Director for Russia, Natalya Khanjenkova, said at the signing ceremony in Rusnano’s Moscow offices.
The glass whose production the EBRD and Rusnano are financing can improve the energy efficiency of buildings in a country where only a third of the ageing housing stock has modern glazing and where the share of energy-efficient glass is just four percent.
The building sector is the largest energy end-user in Russia, accounting for a third of all final energy consumption. Comparisons with Norway, which has a similar climate, indicate potential energy savings at between 40 percent and 60 percent for the sector.
Today’s EBRD-Rusnano equity investment makes possible a merger in the glass industry that will bring together the NSG Group’s Pilkington Glass Russian subsidiary and STiS, one of the largest manufacturers of multiple glass panes in Europe. It will create the first holding in Russia to integrate upstream glass manufacturing with nationwide downstream processing.
The EBRD will have the right to propose a candidate for election to the main board of the joint venture.
In 2004, the EBRD agreed to lend Pilkington EUR 57.5 million to help it build its first float glass production line near Ramenskoye in the Moscow region. The new production line with an annual capacity of 240,000 tonnes will also be built at Ramenskoye.