|
Second EBRD financing to Ukrainian sunflower oil producer
One of Ukraine's largest sunflower oil production companies, Dniepropetrovsk Oil Extraction Plant (DOEP), is to receive its second financing from the European Bank for Reconstruction and Development (EBRD), allowing it to expand further its production and sales of refined bottled oil. The US$ 20 million (ECU 18.1 million) financing package includes the EBRD's first revolving credit facility to finance the working capital needs of an agribusiness enterprise in the former Soviet Union.
Jacques de Larosière, President of the EBRD, said: "DOEP represents one of Ukraine's success stories and demonstrates the EBRD's continuing support for strong, commercially viable companies in the country. It sends a strong signal that sound business opportunities do exist in Ukraine and can be developed to a high standard."
DOEP's Executive Director, Alexandr Zhurid, said: "Agribusiness is critically important to Ukraine's economy and we see great potential for DOEP to capture substantial market share, domestically and abroad, as a result of the EBRD's financial injection. It will also have a very positive impact on Ukraine's agricultural producers."
The US$ 20 million financing package consists of a US$ 15 million revolving loan, which allows the company to borrow and repay according to its needs, and a US$ 5 million subordinated term loan. The proceeds will be used primarily to purchase raw materials. In 1995 the EBRD invested US$ 8.5 million (ECU 6.43 million) in the company to construct a refinery and bottling plant for edible oil, allowing DOEP to shift its activities away from commodity production to higher value-added products.
DOEP's refined product will be marketed in Russia and Ukraine under the brand name "Oleina", a joint venture between one of the world's largest edible oil producers, Céréol, and the company's main shareholder, Ilta Holding S.A. Oleina is one of the most popular brands of cooking oils in the Russian market.
Ilta Holding, a Swiss company whose activities are exclusively focused in Ukraine, has been active in the country's edible oil seed industry since 1989. Ilta Group's other activities in Ukraine include food distribution through two subsidiaries, Ilta Distribution and Delta Ukraine, and a Peugeot dealership network. Theodore Margellos, Director of Ilta, said: "DOEP is a living example that foreign investment in Ukraine can be successful, as long as it can rely on competent and dedicated local management."
Located in the Dniepr river port area of Dniepropetrovsk, 500km south of Kiev, DOEP was the first fully privatised processing plant of edible oil in Ukraine, where it has been operating for 50 years.
|
