Stomana Industry

Overview
Project Summary Document
Environmental and Social Documentation
Procurement
Complaints

Overview

Up to EUR 35 million senior secured loan to Stomana Industry AD ("Stomana", or the "Company").

Project ID 54128

Status Approved

Location

Bulgaria

Business Sector

Notice Type

Private

Project timeline

Exploratory
Passed Concept Review
Passed Structure Review
Passed Final Review
Board Approved
Signed
Implementing
Completed

Company Contact Information

Georgios Bourniotis
gbourniotis@stomana.bg
www.stomana.bg
1 Vladaysko Vastanie str., 2300 Pernik, Bulgaria

Project ID 54128

Status Approved

Location

Bulgaria

Business Sector

Notice Type

Private

Environmental Category

Approval Date

12 Jul 2023

Disclosure date

09 Jun 2023

Stomana Industry (Bulgarian) (PDF, 0.31MB)

Project description

Up to EUR 35 million senior secured loan to Stomana Industry AD ("Stomana", or the "Company").

Project objectives

The proceeds of the loan will be used to finance the Company's medium term decarbonisation strategy including energy and water efficiency, quality and cost optimization measures as well as elimination of production bottlenecks. As part of the Project, Stomana will also install at its production site a PV electricity generation capacity for own use of up to 10MW to further decarbonise its operations.

Transition impact

ETI Score:60

Green: the Project entails investments towards modernisation of production equipment and auxiliary infrastructure resulting in significant energy efficiency and environmental improvements including with regards to the plant's water sourcing, treatment and recirculation infrastructure. The Project is aligned with EBRD's Green Economy Transition ("GET") approach, with 79% of the loan proceeds being utilised towards GET-eligible investments.

Client information

STOMANA INDUSTRY AD

Stomana Industry AD, a joint stock company incorporated in Bulgaria, is a producer of a wide range of steel products for various sectors, sourcing 100% of its output from recycled steel scrap.

EBRD Finance Summary

EUR 35,000,000.00

Senior secured loan of up to 7 years tenor, including (i) EUR 25,000,000.00 Committed Tranche, and (ii) EUR 10,000,000.00 Uncommitted Tranche, to be committed at the Bank's sole discretion.

Total project cost

EUR 57,300,000.00

Additionality

The additionality of the EBRD financing includes financing structure and standard-setting: helping the client obtain long-term financing at reasonable terms, as well as go beyond the national/EU environmental legislation and ensure long-term EU Taxonomy compliance, specifically addressing substantial contribution for climate change mitigation.

Environmental & Social Summary

Category (B ESP 2019). Key environmental and social issues relate to the operations of the plant and scrap facilities and ensuring compliance with EU Best Available Techniques (BAT) as well as health and safety and labour standards.

The Bank has undertaken an independent Environmental and Social Due Diligence (ESDD) of the Project which included a review of corporate Envrionmental, Social and Governance (ESG) management systems. The ongoing ESDD and preliminary reports indicated that the Project is structured to meet the Bank Performance Requirements (PRs) and the Company has the institutional capacity to fully implement the Bank's PRs and comply with Good Industry Practices (GIP) and EU requirements. The Company operates a number of facilities and the ESDD has confirmed that these are well managed and maintained in compliance with national legislation. The Company has a robust Environment, Health and Safety (EHS) management system and is preparing to implement and adhere to EU environmental regulations, such as the Corporate Sustainability Reporting Directive (CSRD) and Corporates Sustainability Due Diligence Directive (CSDDD) requirements. The Consultants have undertaken a review of corporate management and reporting systems and confirmed that the Company is on track to meet the requirements post 2025. The Bank will require the Company to fully adhere to the CSRD and CSDDD in the Environmental and Social Action Plan (ESAP).

In terms of the operations the ESDD has confirmed that the Company is in compliance with national and EU requirements inclusive of EU Industrial Emission Directive (IED) and BAT, although some additional investment may be required to ensure ongoing compliance and these will be included in the ESAP under development. The collection of scrap and processing of scrap can be associated with a number of health and safety as well as labour issues and the supply chain assessment is important to ensure that sourcing of scrap is well managed.

The ongoing ESDD has confirmed that the Company has good labour management systems and no material issues of non-compliance have been identified. Nevertheless the Company will need to strengthen some of the oversights in line with requirements as set out under the CSRD and relevant European Sustainability Reporting Standards (ESRS).

The Project will not be associated with resettlement or livelihood loss and is not located in an ecologically sensitive area.

The ongoing ESDD has confirmed that Project is Paris aligned for climate mitigation as the counterparty's operational activities make a substantial contribution to climate mitigation objectives which is in line with the specific criteria set out in the EU Taxonomy and confirmed during the external ESDD. In specific, the Company produces carbon steel and uses over 90% steel scrap input relative to product output. The Project is deemed not significantly exposed to physical climate risks and is considered Paris aligned for climate adaptation.

Based on the ESDD an ESAP and Non-Technical Summary (NTS) will be developed and agreed with the Company prior to Board submission.

The PSD will be updated once the ESDD is complete and ESAP agreed on.

Technical Cooperation and Grant Financing

None

Company Contact Information

Georgios Bourniotis
gbourniotis@stomana.bg
www.stomana.bg
1 Vladaysko Vastanie str., 2300 Pernik, Bulgaria

Implementation summary

PSD last updated

09 Jun 2023

Understanding transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with the EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168
Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794
Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and its associated Environmental and Social Requirements (ESRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”. The ESP and the ESRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation, and to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about the environmental and social (E&S) 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 also requires its clients to disclose information, as appropriate, about the risks and impacts of 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 of the Bank's activities 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 EBRD believes that identifying and resolving issues in the project assessment and approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts andhelps to monitor integrity risks in projects post-investment.

OCCO is further responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, either within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. OCCO will follow-up all matters reported. It will review all matters reported. 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, which entered into force on 1 January 2025, sets out how the EBRD discloses information and consults with its stakeholders to promote better awareness and understanding of its strategies, policies and operations. 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 (for example, 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 the 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 more about IPAM and its mandate and how to submit a Request for review. Alternatively, contact IPAM by email at ipam@ebrd.com for guidance and more information on IPAM and how to submit a request.

Environmental and Social Documentation is not available for this project.

Selected procurement notices related to this project may be shown below. Further procurement opportunities related to this and other projects, if available, maybe be viewed in the EBRD Procurement Portal.

The EBRD's Environmental and Social Policy (ESP), Access to Information policy (AIP) and Project Accountability Policy (PAP) enable sound and sustainable development in its projects. The Independent Project Accountability Mechanism (IPAM) deals with complaints about environmental, social and disclosure matters related to the Bank’s investments.

No complaints about this project have been made so far.

Our story

How we invest in changing lives

What we offer for businesses

Search

Stomana Industry

Overview

Project timeline

Company Contact Information

Project description

Project objectives

Transition impact

Client information

EBRD Finance Summary

Total project cost

Additionality

Environmental & Social Summary

Technical Cooperation and Grant Financing

Company Contact Information

Implementation summary

PSD last updated

Understanding transition

Business opportunities

General enquiries

Environmental and Social Policy (ESP)

Integrity and compliance

Access to Information Policy (AIP)

Independent Project Accountability Mechanism (IPAM)