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EBRD funds underwater cables for a sustainable future

By Olga Aristeidou

  • EBRD lends €88 million to Greek cable manufacturer Fulgor SA, part of Viohalco Group
  • Investment to support the production of deep-sea underwater cable interconnections facilitating transition towards a lower carbon economy
  • Project under the EBRD’s Greek RRF Co-Financing Framework, partly funded by the EU

The European Bank for Reconstruction and Development (EBRD) is providing an €88 million loan to Fulgor SA, a Greek maker of submarine cables for connecting islands and offshore wind projects with the mainland.

The project is the fourth sub-operation to take place under the EBRD’s Greek Recovery and Resilience Facility (RRF) Co-Financing Framework, implemented as part of the “Greece 2.0” National Recovery and Resilience Plan, funded by the European Union’s (EU) NextGenerationEU programme.

The loan consists of €62.8 million of EBRD financing, blended with €25.2 million of RRF loans channelled through the Greek Ministry of Finance.

The funds will be used to support an investment programme of up to €110 million to expand Fulgor’s annual cable production capacity and finance associated working capital outlays, as well as research and development (R&D) initiatives. Fulgor will cover the remaining €22 million (20 per cent) of the project’s cost.

Fulgor is active in the design, production and installation of underwater cables, as well as the production of copper and aluminium wires and rods. The company is fully owned by Cenergy Holdings SA via Hellenic Cables SA, both subsidiaries of the Viohalco Group. 

The implementation of Fulgor’s 2023-25 investment plan will enable it to manufacture green infrastructure that fosters the transition to a lower-carbon economy and increases access to affordable clean energy sources. The project will unlock opportunities for Fulgor to participate in large interconnection projects and capture the envisaged growth in offshore wind energy installations.

As part of the EBRD’s support, the company’s direct owner, Hellenic Cables, has agreed to undertake a number of initiatives, such as mentoring programmes, training courses and action plans to address gender gaps, which will strengthen its existing policy on female empowerment and gender equality.

Jürgen Rigterink, EBRD First Vice President, stressed the importance of the transaction to the Bank: “I am delighted to be signing this important transaction with Fulgor, part of our long-standing partner, Viohalco Group. Not only does this substantial investment specifically support Fulgor’s production capacity and R&D capabilities, it also assists in the country’s overall sustainable transition by working to develop the offshore wind industry. This transaction combines green, gender and digital solutions – three of the EBRD’s most important strategic priorities.”

Theodoros Skylakakis, Alternate Minister of Finance of Greece, in charge of the implementation of the National Recovery and Resilience Plan, said: "This €110 million investment for the production of underwater cable interconnections facilitates access to affordable sources of clean energy. The investment plan is implemented within the Greek RRF Co-Financing Framework. The loan part of the plan is one of the most successful development tools our country has ever had, as it provides loans at an extremely low interest rate to innovative businesses."

Nikos Mantzoufas, Governor of the Greek Recovery and Resilience Agency, said: “We are delighted about this investment of €110 million and the contribution of the RRF lending facility. Fulgor, an industrial production unit for the construction of submarine cables, is based in Korinthos, is set to create many highly skilled jobs and is being implemented by a company with significant export activity. It is thus further tangible proof of how the RRF is contributing to the strengthening of our country's green technology productive export capacity.”

Alexis Alexiou, Cenergy Holdings Chief Executive Officer, commented on the importance of the investment to Fulgor: “The investment in Fulgor’s capacity will allow Hellenic Cables to smoothly execute a very strong order backlog while at the same time get ready to meet the increase in demand for renewable infrastructure and the high expectations of all our stakeholders.  The EBRD is proving, once again, a supportive partner in our vision to become a key enabler of the transition to green energy.”

The EBRD has partnered with the government of Greece on the implementation of the country’s National Recovery and Resilience Plan to fund to the Greek economy. The Bank’s programme will combine RRF loans managed and deployed by the EBRD, the Bank’s own commercial financing, and financing from private investors and commercial banks to achieve significant multiplier effects. Funds totalling up to €1 billion will be deployed in Greece through the end of 2025.

To date, the EBRD has invested more than €6.6 billion in more than 100 projects in the corporate, financial, energy and infrastructure sectors of the Greek economy.

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