Provision of a EUR 5m long-term loan (the "Loan") to Aquila Part Prod Com SA ("Aquila") and concluding a EUR 5m call option to buy from Aquila's founding shareholders a number of shares in Aquila up to the value of the loan disbursed, at a pre-agreed strike price.
The proceeds from the Loan will enable Aquila to finance the expansion of its own brands portfolio, new warehouse automation, a new ERP system, as well as other working capital and capital expenditures needs. These investments will improve the reach of Aquila's own brands, as well as improve warehouse productivity and help the company enhance its digitalisation.
ETI score: 65
The Project's transition impact is expected to derive from
(1) Well Governed (Primary) - The Project will support Aquila in implementing a comprehensive Corporate Governance Action Plan ("CGAP") to improve its governance practices and enhance its board procedures in the context of its future IPO.
(2) Competitive (Secondary) - The Project will support investments in warehouse automation and new IT systems, leading to productivity gains and improved operational performance.
AQUILA PART PROD COM SA
AQUILA PART PROD COM SA ("Aquila"), is the largest FMCG distributor in Romania and the Republic of Moldova, delivering to 67,000 selling points. It operates a network of 14 distribution centres and a fleet of over 1,600 vehicles.
EBRD Finance Summary
Total Project Cost
Innovative financing structures and/or instruments. The EBRD offers an innovative financing structure (a combination of loan and call option) not available before on the local market.
Standard-setting: Aquila seeks/makes use of EBRD expertise on corporate governance improvements. The Bank provides support for the Company to improve its corporate governance via the design of a CGAP, which will be implemented over the course of the project.
Environmental and Social Summary
Categorised B (ESP 2019). Environmental and social (E&S) risks related to the operation of a FMCG distribution and logistics Group and implementation of the Project are site specific and can be managed by appropriate mitigation measures. The E&S due diligence was carried out in-house by ESD in line with the COVID-19 approach through the review of E&S questionnaires, supporting documents and video meetings with Aquila Group management. There is no GET component associated with this project.
The Group operates a fleet of over 1600 vehicles and 14 distribution centres. The E&S review covered a wide range of topics including the Group's labour practices and limited use of migrant labour, E&S risks and liabilities of Aquila's own warehouse, occupational health & safety, the Group's assessment of E&S risk in its supply chain and supply chain management, driver safety, air emissions particularly from transport and stakeholder engagement. No significant or unidentified risks were revealed through the due diligence process. The review demonstrated that the Group's management of E&S issues is generally focussed on national compliance and is not done within the context of structured management systems. Certain areas are well developed, such as the management of health and safety, while other areas require further attention.
To address the identified issues, an environmental and social action plan (ESAP) has been drafted and has been agreed with the Group. The ESAP focuses largely on management systems and includes actions for the Group to develop and implement an environmental management system, further develop the H&S management system, integrate E&S considerations into supply chain management, develop management systems for energy and resource usage and develop a corporate level stakeholder engagement plan. The ESAP is structured to ensure Group compliance with the Bank's Performance Requirements and the Group will be required to provide annual reporting on its E&S performance and implementation of the ESAP.
Company Contact Information
Str. Malu Rosu nr. 105A, Ploiesti, Prahova, 100491, Romania
PSD last updated
01 Oct 2021
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