The project would provide a framework of US$ 12.3 million to finance the expansion of the Bosch Service Franchisee network of auto-service workshops in Ukraine.
Project objectives: Expanding a network of Bosch Service Franchisees (BSFs) of full-service auto workshops in Ukraine through the development of existing and the establishment of new franchisees carrying the Bosch Service name and delivering Bosch quality standards and products.
The main elements of the transition impact include:
support for the private SME sector in Ukraine by financing locally-owned car servicing companies;
enhancing competition and efficiency in the growing Ukrainian car servicing sector;
demonstration effect by introducing franchising as an innovative concept in the Ukrainian car servicing sector and by demonstrating to local banks ways to finance franchisees;
transfer and dispersion of skills to local SMEs through staff training and equipment upgrades in co-operation with Bosch;
introducing high standards for business conduct and corporate governance for SMEs.
The borrowers are the individual private Bosch Service Franchisees (auto-service workshops) legally incorporated in Ukraine. Bosch Ukraine and Bosch GmbH are clients/the primary interface with the Bank for the structuring of the overall framework, provision of security, as well as beneficiaries from the increased business volume, which the framework enables.
The EBRD proposes a loan framework of US$ 12.3 million with a US$ 200,000 – US$ 500,000 loan provided to each of the 35 Bosch Service Franchisees.
US$ 15.4 million
The project was screened B/1, requiring an environmental audit and an environmental analysis of any future modernisation. The project will offer the opportunity to introduce to the SME sector sound environmental, health and safety practices, including used oil recovery, spare parts and battery recycling, and strict requirements for service agents regarding the procurement, storage, processing and disposal of materials. There should also be positive environmental benefit from developing a network of Bosch Service Facilities on vehicle fuels and engine efficiency in Ukraine.
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Text of the PIP