OREANDA-NEWS. December 23, 2009. The European Bank for Reconstruction and Development is lending up to US50 million to a leading Ukrainian brewery, Obolon. The loan proceeds will be used to restructure Obolon’s balance sheet as well as to finance energy efficiency investments in its production facilities, reported the press-centre of EBRD.

The project envisages special arrangements between the EBRD and a group of commercial banks, including ING Bank Ukraine, UniCredit Bank Ukraine, and Raiffeisen Bank Aval.

According to the arrangements, EBRD’s funds will form the largest part of a financing package of US 123 million and will be used for partial repayment of Obolon’s short-term loan portfolio and its restructuring through extension of tenors and maturities tailored to its cash flow. In particular the Bank will be providing a seven-year facility, whereas commercial banks will extend their facilities to three years.

EBRD Director for Agribusiness Gilles Mettetal said: “This project is especially relevant in current difficult times and is part of the Bank’s crisis response in the agribusiness sector in Ukraine. Obolon is one of the Bank’s longest-standing clients in this country – a company we have worked with since 1997. Our strategy in these challenging circumstances is to help the best industry players in key sectors of the Ukrainian economy, like agribusiness.”

The loan will also finance various energy efficiency improvements, which will help lower production costs, improve competitiveness and raise the ecological standards of Obolon’s operations. The energy savings will be achieved mainly through heat energy recuperation of brewing equipment, an upgrade of the electricity distribution system and optimisation of the production processes.

In the agribusiness sector alone, the EBRD has directly committed more than EUR5 billion in over 330 projects across Central and Eastern Europe and the Commonwealth of Independent States since 1991.The European Bank for Reconstruction and Development is the biggest financial investor in Ukraine. As of 1 November 2009, it had committed EUR4.2 billion through 194 projects.