The Project will support Kormotech LLC working capital financing in response to COVID-19 impact.
This project was approved in the context of the Bank's response to the COVID-19 pandemic. To avoid delays to the delivery of this project, the Bank's President granted a deviation from the ordinary timelines for PSD disclosure, as contemplated by Section V of the Directive on Access to Information. Details of the Bank's response to COVID-19, and this deviation, can be found on our website.
The financing will support Kormotech Group's strategy to maintain and expand its operations in Ukraine and the other countries.
ETI score: 73
The Project is expected to help ensure that the transition impact under the recent project with Kormotech Group remains achievable and, once achieved, is preserved. The original transition impact stems from the following:
- Integrated quality: Supporting the first cross-border green-field investment of this Ukrainian company through the construction of a new production facility located in Lithuania.
- Inclusive quality: Facilitating the expansion of specialised veterinary education in partnership with local universities across Ukraine to improve the employability of young professionals.
The project is associated with the PTI rating of the original transaction with Kormotech Group (73).
The Kormotech Group ("Kormotech", the "Group"), which includes two operating entities - Kormotech LLC (Ukraine) and Kormotech UAB (Lithuania), both consolidated under Vengast Investments ltd (Cyprus), is one of the top three market players in the Ukrainian pet food market and the leading Ukrainian pet food producer. Kormotech LLC is 100% owned by Ukrainian nationals, Olena and Rostyslav Vovk (siblings) via Cyprus domiciled controlling entity LvEnKo Management Group ltd.
EBRD Finance Summary
EBRD is going to provide senior secured multicurrency loan to Kormotech LLC (the "Borrower") in the amount of up to EUR 3.3 million (UAH 100 million equivalent), available in UAH and EUR.
Total Project Cost
Total project cost is EUR 3.3 million (UAH 100 million equivalent).
Under RF, additionality stems from the following:
COVID-19 crisis response: EBRD financing effectively bridges a liquidity gap due to adverse market conditions, the COVID-19 crisis.
Environmental and Social Summary
Categorised B (2019 ESP) and Low-Medium Risk. Investment to provide working capital to a pet food producer are site-specific and can be managed via implementation of the good E&S management practices. The Borrower is an existing EBRD Client who has recently been subject to in-house Environmental and Social Due Diligence which demonstrated that the Company is compliant with national E&S regulatory requirements; possesses adequate E&S management systems and the required certification; and has capacity to implement the Project in line with the PRs. The Client has been implementing the agreed ESAP and its progress will be assessed through the review of the Annual Environmental and Social Report (AESR). There is no GET component associated with the Project.
Technical Cooperation and Grant Financing
TC amount: Funding of 60% of Project's external legal due diligence costs in the amount of EUR 23,400. Another 40% (EUR 15,600) to be covered by the client. TC source: i) Japan-EBRD Technical Cooperation Fund (JECF); ii) the client's contribution.
Company Contact Information
+38 050 377 61 92
+38 032 298 98 32
Kormotech LLC 79041, 73, Heroyiv UPA Str., Lviv, Ukraine
PSD last updated
07 Dec 2020
Further information regarding the EBRD’s approach to measuring transition impact is available here.
For business opportunities or procurement, contact the client company.
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Tel: +44 20 7338 7168
Specific enquiries can be made using the EBRD Enquiries form.
Environmental and Social Policy (ESP)
The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.
More information on the EBRD’s practices in this regard is set out in the ESP.
Integrity and Compliance
The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.
OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to email@example.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.
Access to Information Policy (AIP)
The AIP 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 following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.
Specific requests for information can be made using the EBRD Enquiries form.
Independent Project Accountability Mechanism (IPAM)
If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).
IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.
Please visit the Independent Project Accountability Mechanism webpage to find out how to submit a Request for review through our confidential online form, by email, mail or telephone. IPAM is available to discuss your concerns and answer any questions you may have about the submission or handling of Requests, which follow the Project Accountability Policy and Guidance. Requesters’ identities may be kept confidential, upon request.