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EBRD and Castel support drinks market in the CIS
$20 million equity investment to promote business in Russia and Caucasus
In a move signalling confidence in the business prospects of the Commonwealth of Independent States by one of France’s largest beverage companies, the European Bank for Reconstruction and Development is investing $20 million in BIH Brasseries Internationales Holding (Eastern) Ltd (“BIH Eastern”), the holding company of Groupe Castel’s beer, wine and mineral water operations in Armenia, Azerbaijan, Georgia and Russia.
The funds will be used to restructure Castel’s production and distribution capabilities throughout Russia and the Caucasus, as well as for selective development across the region. They should also act as a catalyst in enhancing corporate governance of BIH Eastern’s subsidiaries in the region.
Groupe Castel is the leading distributor of wine in Europe and the second largest worldwide. It is also the third largest water producer in France in volume. In Africa, the Group is the leading beer producer and bottler for Coca Cola. Groupe Castel has been one of the first foreign investors in the agribusiness sector in the Caucasus countries, where it has been developing its presence in the brewery sector since 1997.
Speaking at the signing ceremony in London, Pierre Castel, President of Groupe Castel, said that he was “very pleased with this first step in the cooperation between Groupe Castel and the EBRD.” Noreen Doyle, the EBRD’s First Vice President, said that the transaction offered the Bank a rare opportunity to invest across CIS countries and in particular showed its commitment to foster economic transition in the Caucasus countries.
The EBRD is one of the largest private sector investors in central and eastern Europe and the CIS, with some 200 investments in the agribusiness sector alone totalling more than €3 billion.
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