|
EBRD invests in Ukrainian Iveco-Kraz truck manufacturer
Iveco-Kraz, a new Ukrainian joint stock company linking Iveco SpA (Iveco), a leading truck manufacturer, the Kremenchug Automobile Plant (Kraz), Ukraine’s largest commercial vehicle manufacturer, and the European Bank for Reconstruction and Development (EBRD), will begin production of commercial vehicles later this year. The EBRD is investing US$ 18 million (ECU 13.5 million) in the joint venture, its largest investment in the Ukrainian private sector to date.
The three shareholders signed agreements at Iveco’s headquarters in Turin, Italy, yesterday, giving Kraz and Iveco SpA 35 per cent each and the EBRD a 30 per cent stake in the company.
At the signing, Mark Tomlinson, Director of the EBRD’s Ukraine team, said: “Our objective is to create a strongly managed and competitively placed Ukrainian manufacturer of light and medium-sized commercial vehicles. The benefits to Ukraine’s economy are expected to be significant and will not be limited to local component suppliers, but will extend to a wide variety of smaller businesses.”
As a founding shareholder, the EBRD’s investment will be used to finance capital expenditures and working capital. The joint venture company will manufacture and distribute two models of light and medium-sized trucks (based on the Daily and EuroCargo ranges) which will be produced at the Kremenchug plant in central Ukraine. Components will initially be sourced by Iveco in Italy but Iveco-Kraz intends to increase the local content to 70 per cent over the next few years and have an annual production of 12,000 units.
Kraz was founded in 1945 and specialises in manufacturing heavy trucks. There are 13 production sites through Ukraine, employing 20,000 people in all.
Iveco is a wholly owned subsidiary of Fiat SpA and the second largest manufacturer of commercial vehicles in Europe, with approximately 20 per cent of market share. The company employs 31,500 people directly and manufactures vehicles and engines in 19 plants in Europe.
|
