Zagreb Holding Water and Sewer Investment Project



Project number:


Business sector:

Municipal and environmental infrastructure

Notice type:


Environmental category:


Approval date:

06 Nov 2007



PSD disclosed:

26 Mar 2007

Project Description

The proposed project will involve the issuance of bonds by the Zagreb Holding Company in one or more tranches to finance a portion of the capital investment requirements of its business units over the next 3-4 years. These investments are currently expected to include water and wastewater network rehabilitation and expansion; public transport improvements; and refinancing of some existing debt of the Company’s businesses.

Transition Impact

  • Demonstration of new ways of financing infrastructure projects through use of the capital markets for companies associated with municipalities.
  • Improved corporate governance in establishing appropriate relationships between City and Company, as well as improving financial accounting and cost recovery for City or business units.

  • Develop potential private sector participation through identification of potential outsourcing or spin-off of some of the Company’s operations or business units.


The Client

Gradsko Komunalno Gospodarstvo (“GKG” or “Zagreb Holding Company”) was recently established as a holding company for the City of Zagreb’s associated business units which perform various municipal services, including public transport, water and wastewater, gas distribution and solid waste management.

EBRD Finance

EBRD will be a potential purchaser of bonds issued by the Company, together with other market investors.

Project Cost

Estimated at EUR 260 million equivalent in Croatian Kuna or Euros or a mixture of the two currencies.

Environmental Impact

Screened C/1, requiring an Environmental Audit of the Holding Company and its subsidiaries. In addition, specific components of the investment programme to be financed with the EBRD proceeds will need to undergo environmental appraisal in accordance with the EBRD Environmental Policy.

The Environmental Audit is being undertaken by independent consultants to review the Holding Company’s corporate environmental management as well as to identify, assess and manage the environmental issues associated with its subsidiaries’ assets and operations. The consultant is also preparing Environmental Analyses of EBRD financed components, which fall within environmental category “B” under the EBRD’s Environmental Policy. Each Environmental Analysis will identify and assess potential environmental and social impacts and propose mitigation measures to ensure that the investment components fully meet Croatian and EU EHS standards. Any EBRD financed components that fall under environmental Category “A” in accordance with the Bank's Environmental Policy, will need to undergo an independent Environmental Impact Assessment (“EIA”) and public consultation process as per the EBRD requirements.

An Environmental Action Plan is being developed as part of the due diligence to address measures needed for achieving compliance with Croatian environmental regulations and with European Union environmental standards, for the organisation of EHS management of Zagreb Holding and related responsibilities as well as for meeting environmental permitting requirements applicable under current legislation.

This section will be updated upon completion of the environmental investigations.

Technical Cooperation

Consultants funded by the Government of the Netherlands are engaged to review project investments, environmental impact, and financial structure.


Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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