The proposed project will provide up to USD 60 million debt financing to the Client to support the Monetka’s expansion throughout Ural’s Federal District of Russia over 2008-2010 as well as restructure its debt portfolio. The financing will allow timely implementation of the investment programme and strengthen Monetka’s market positions.
The Project will address one of the key transition challenges in the sector by significantly contributing to fulfilling the long unmet demand for a modern format of food retail in the smaller cities/towns in the Urals region where competition and penetration of modern formats is still minimal or insufficient, and retail is in a need of improvement in products hygiene standards, quality and product choice to consumers, and customer orientation of suppliers. The Monetka outlets will mainly be situated in cities of over 30k inhabitants, where the penetration of modern distribution has not yet taken place which will assist in reducing regional and structural disparities. Procurement of products locally will generate strong backward linkages and encourage local producers to process better quality and higher quantity according to best business practice.
OOO RM Group, a limited liability company, a holding company for Monetka’s discounter and supermarket chain in Russia.
Up to USD 60 million long-term senior secured loan, of which up to USD 30 million to be financed by EBRD and the rest to be syndicated to commercial banks under EBRD A/B loan structure.
USD 230 million
The proposed project has been screened C/1. Due diligence undertaken for this project has demonstrated that the Company complies with the necessary Russian requirements for environment, health and safety (EHS) and labour, and has certain procedures in place for assessing EHS risks and liabilities in its planned stores. The Company has a comprehensive policy with regard to health and safety which includes priorities for protecting in-store sanitary standards and the health and safety of staff. The Company has initiated and successfully introduced in the operation process a number of environmentally-friendly initiatives in relation to energy efficiency and saving, recycling and CO2 emission reduction. On the basis of the existing EHSL procedures the Company will be required to develop and implement a comprehensive Environmental Management System and EHS procedures for site selection and acquisition according to the best international practice, and this requirement will be covered by a time-and cost-bound, Environmental Action Plan (‘EAP’). The Company will also have to comply with relevant EU requirements for environment, health and safety, including hygiene and health and safety at work place, under the proposed loan agreement and provide the Bank with an annual environmental and social report.
Sergey Patanin, Financial Adviser to the CEO
Tel.: +7 343 216-19-70
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