Senior secured loan of up to USD 2.0 million (EUR 1.7 million) to RER Modern Hides LLC.
The company is seeking financing for the construction of a new modern production plant and auxiliary facilities that will enable RER Modern Hides to improve the quality of manufactured leather hides and expand the product variety reaching wider customer base and export markets.
ETI score: 80
The DFF SME framework primarily targets the "Competitive" quality by helping SMEs to restructure and become more efficient or professional. Sub-projects can target any of the other transition qualities as secondary objective. The project is supporting framework objectives by supporting an SME in the following areas: "Competitive" and "Integrated".
RER MODERN HIDES LLC
RER Modern Hides LLC is one of the largest producers and exporters of semi-finished and finished leather hides in Azerbaijan.
EBRD Finance Summary
Total Project Cost
Additionality stems from tenor and repayment structure of the proposed loan, which is necessary to undertake the capex programme for construction of the production plant. Local banks mostly provide shorter tenor loans with restrictive repayment schedule (amortizing structure without grace period) that limits the company's capacity to implement investment programme.
Environmental and Social Summary
Category B (2019 ESP). Due diligence has involved a review of a completed Environment and Human Health, Safety, and Security (EHSS) questionnaire by the client which has shown that the environmental and social risks associated with the project are site specific and can be managed via standard industry practice. The questionnaire has highlighted a number of areas that will require to be addressed in an Environmental and Social Action Plan that will be agreed with the client prior to signing. Specifically, these areas include: the lack of a documented environmental risk management procedure for an operation that involves the use of potentially hazardous materials such as solvents; a review of the client's human resources policies to confirm compliance with the requirements of the International Labour Organisation in relation to age and nature of employment; the implementation of an employee grievance that meets the requirements of the EBRD's Performance Requirement 2; and the development of a contractor management plan to address the risks related to the use of contractors in the proposed construction works.
Technical Cooperation and Grant Financing
1. Legal due diligence to be financed 80% by the Turkey - EBRD Cooperation Fund Account and 20% by the company.
2. Lender Supervisor to be financed 80% by the Turkey - EBRD Cooperation Fund Account and 20% by the company.
Company Contact Information
Absheron district, Ashaghi Guzdek settlement
PSD last updated
21 Apr 2021
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