Provision of USD 2,500,000 to finance the upgrade of existing equipment for the production of PET pre-forms and screw caps (the "project").
The main objective is to invest in equipment upgrade which will allow the production of new type and lighter weight pre-forms and screw caps.
ETI score: 80
1.The project will allow the borrower to convert its production line to manufacture lighter PET performs and caps thus saving on the raw material used resulting in improvements in profitability and contributing to the Competitive quality.
2. As part of the project, the company will be able to increase the production capacity of screw caps. The increased capacity opens up an opportunity for the screw caps exports to the neighboring countries contributing to the Integrated quality.
AK GAP ECONOMIC SOCIETY
Economic Society Ak Gap ("Ak Gap", the "company" or the "borrower") is the leading producer of PET preforms in Turkmenistan and through its 50%-owned subsidiary, Turkmen Penjire, it is the local manufacturer of PVC profiles (collectively referred to as the "Group").
EBRD Finance Summary
A senior secured long-term loan of USD 2,500,000 million for financing of the Group's capital expenditure.
Total Project Cost
Total project costs are USD 3,500,000 of which USD 2,500,000 will be provided by the EBRD and the remaining USD 1,000,000 by the Borrower through internally generated cash.
EBRD is providing financing in USD, which is scarce in the local market and with a loan tenor (of three years) which is longer than other available offers on the local market.
Environmental and Social Summary
Categorised C (ESP 20190). The Company is a long standing client of the Bank and performance to date has been satisfactory. An in-depth environmental and social due diligence has been undertaken by the EBRD throughout the past ten years of relationship with the Company, resulting in the drafting of an environmental and social action plan with a particular focus on health and safety issues. The Company has since been providing reporting on both general compliance with EBRD's PR requirements and with the agreed ESAP. All items on the ESAP have been completed nearly all within the time frames agreed with the Company. As a supplier to some of the largest soft drinks and bottled water producers globally, the Company is also subject to a number of environmental and social audits to ensure that the Company complies with the stringent supplier requirements.
Technical Cooperation and Grant Financing
The Project will have a Technical Cooperation (TC) component provided by SME F&D - EU (Investment Facility for Central Asia IFCA). The TC funds will partially cover the legal due diligence costs.
Company Contact Information
+993 12 295 772
Economic Society "Ak Gap" 171 Taze Zaman Ashgabat Turkmenistan
PSD last updated
06 Jul 2020
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