January 15, 2016 | Cbonds
|New project to support operations of leading local corporate, promote farm land cultivation |
The European Bank for Reconstruction and Development (EBRD) is providing a US$ 20 million revolving working capital facility to Ukrainian Agrarian Investments (UAI), which operates over 70 farms located across northern and western Ukraine. The loan replaces the previous financing facility of US$ 13 million provided to UAI in 2014. The proceeds will be used both for pre and post-harvest financing needs of a leading domestic agribusiness holding.
By extending the new facility to UAI, the Bank is once again demonstrating its commitment to support its strong existing clients in one the most important sectors of the Ukrainian economy. The EBRD is planning to pledge additional support in order to help agribusiness companies address their liquidity and working capital needs as well as to restore the market’s confidence and appetite for future projects in the country.
UAI has been successfully working with the EBRD since 2010. The loan proceeds will enable the company to fully secure its seasonal working capital needs to harvest 195,000 hectares in the times when availability of funding in Ukraine has reduced significantly.
Sevki Acuner, EBRD Director for Ukraine, said: “I want to underline how important the agribusiness sector is for the Ukrainian economy and for our operations in the country. We are very pleased to sign this transaction because it gives us an opportunity to continue to support the growth of a strong local company. This new loan demonstrates our strong commitment to UAI as a long-term partner.”
“This transaction is part of the Bank’s anti-crisis response but it is also an excellent example of EBRD’s long-term support to solid Ukrainian companies” said Wojtek Boniaszczuk, Head of Agribusiness for Ukraine. “This project supports sustainable primary agriculture, for the benefit of the local economy and the country as a whole.”
Ukrainian agribusiness remains a key sector for the EBRD, which committed funding worth over €175 million in 2015 alone.
The EBRD is the largest international financial investor in Ukraine. As of 1 January 2016, the Bank had a total cumulative commitment of approximately €12 billion in 357 projects throughout the country.