Proposed term debt facility to be provided to Danfoss A/S to finance 80 per cent of individual energy efficiency projects in certain eastern European breweries. Target breweries are owned by major western investors. The project objective is to combine the technical skill of a leading engineering and environmental components company with EBRD financing to enable breweries in the region to improve their operating efficiency. Proceeds will be used to finance up to 80 per cent of each investment, which is to be entirely repaid out of energy savings. Financed investments will have a payback period of four years or less. Implementation will be carried out by Danfoss Solutions A/S on a performance contract basis.
This financing will enable breweries across the region to use energy, including water, steam and electricity, more efficiently, helping to instil western operating standards at a time when energy costs are rising. The cash flow freed up due to the reduction in energy bills will further benefit the breweries.
The Danfoss Group is Denmark's largest industrial company with an annual sales turnover in 2001 of €1,935 million and about 16,500 employees. The Danfoss Group is a world leader in research, development and production of mechanical and electronic components for three broad business groups: refrigeration and air conditioning, heating and water, and motion control.
The proposed loan is a seven-year term debt facility in the amount of €10 million.
Total project cost will be at least €12.5 million as the loan will finance 80 per cent of each energy efficiency investment.
The project will finance investments that will reduce energy consumption and related adverse environmental impacts in the facilities of Danfoss clients. The Bank will review the result of Danfoss' environmental due diligence prior to give its no objection to any investment.
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