A senior loan of up to KZT 4.9 billion (equivalent to €9.5 million) to support balance sheet restructuring of Mangistauskaya Regional Distribution Company (MREK), a private electricity distribution company in Kazakhstan.
The proceeds of the loan will be used to refinance existing FX-denominated liabilities, which will improve the overall risk profile of MREK making it well positioned for the implementation of its investment programme in the next regulatory period and more resilient against future uncertainties from the Covid-19 pandemic.
ETI score: 75
The Project will support a private sector company in establishing partnership with local education institutions, developing and/or improving NOSS and engaging with public authorities to promote gender equality and youth inclusion. This will unblock the systemic obstacle to economic inclusion that is represented by the substantial skills mismatch, low economic participation of women and unequal access to education and training opportunities attributable to Mangistauskaya oblast. In addition, the Project will support balance sheet restructuring of the Borrower making it more resilient to FX risks in the post-Covid-19 environment.
MANGISTAU ELECTRICITY DISTRIBUTION NETWORK COMPANY JSC
MREK is a power utility responsible for electricity distribution in the Mangistauskaya oblast, western Kazakhstan. MREK is rated by B+ Fitch.
EBRD Finance Summary
Total Project Cost
Financing Structure: The EBRD offers financing that is not available in the market from commercial sources on reasonable terms and conditions, e.g. a longer grace period. Such financing is necessary to structure the project.
Standard-setting: helping projects and clients achieve higher standards: The Client will make use of EBRD expertise on higher inclusion, gender standards and equal opportunities. The dual-learning programme will aim to reach at least 30 per cent of female participants and will be developed with a gender lens. To narrow the gaps between young women and men in science, technology, engineering and maths (STEM) subjects, career advice to young people and outreach to local schools through female and male role models (chosen among successful MREK's employees) will be embedded in the programme to improve the awareness of equal opportunities in the industry.
Environmental and Social Summary
Categorised B (ESP 2019). The Project's use of proceeds is to support balance sheet restructuring and buy-back of FX bonds with an existing Client. The Bank undertook an independent Environmental and Social Due Diligence (ESDD) in 2018, including corporate environmental and social management systems review, assessment of the 2016-2020 investment programme and E&S audit of the key facilities. Based on the ESDD a comprehensive ESAP was developed to ensure compliance with the EBRD PR's. The Company is on track with implementing an existing ESAP with slight delays on a few items, including biodiversity related database and land plots registration. The current Project's ESDD was undertaken in-house in line with the ESD CV-19 ESDD Guidance, including additional ESDD Questionnaire, Covid related Questionnaire, interviews with the relevant staff, review of the corporate ESG management systems, annual E&S report and supporting materials for the ESAP implementation status. Based on the ESDD the ESAP remains still valid for the new Project to ensure compliance with the EBRD ESP 2019 requirements.
The Bank will continue to monitor the Client's performance, and an audit will be scheduled in due course over the next few years.
Technical Cooperation and Grant Financing
The Bank will provide a TC assignment on a cost sharing basis with the client to support MREK in integration of industry teaching practices into the programmes of educational institutions and promotion of workforce diversity to address operational challenges related to the skills-mismatch.
Company Contact Information
Denisova Ekaterina Aleksandrovna
8 (7292) 200-225, 200-203, 202-666
JSC Mangistauskaya Regional Distribution Company 29a microdistrict, building 97 Aktau, Mangistauskaya oblast Kazakhstan 130000
PSD last updated
18 Aug 2021
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