EBRD lends Auto Rubber and Star Group up to US$30m in Uzbekistan
Both loans to private Uzbek companies come with governance support backed partly by a Japanese fund; a €15m Bosnian car parts loan came a day earlier.
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The European Bank for Reconstruction and Development is lending up to US$30m to two privately owned Uzbek companies, the car parts maker Auto Rubber and the consumer goods distributor Star Group, the bank said on 30 October.
Auto Rubber, which makes automotive rubber sealing systems and other technical rubber components, gets a loan of up to US$10m (€8.8m), the EBRD said in its release on the Auto Rubber loan. The money will finance the company's development programme and the expansion and localisation of its production facilities, including new equipment for semi-finished products and a rubber compound production line. The bank says the project will help turn Auto Rubber into a diversified automotive component manufacturer.
Star Group gets up to US$20m (€17.7m). The borrowers are four companies, Support Samarqand, Bloomshop, Star Distribution and Star FMCG, which the bank describes as a fast-growing local distributor of fast-moving consumer goods, according to the EBRD's release on Star Group. The loan will fund working capital and expansion, including the group's beauty-shop retail chain in Tashkent and Samarkand, to widen its regional presence and product range.
Both loans come with support for the companies' boards. The EBRD will help Auto Rubber strengthen its corporate governance and adopt formal internal policies on gender equality, with grant funding from the Japan-EBRD Cooperation Fund. Star Group will get grant funding from the bank and the same Japanese fund to draw up a corporate governance action plan, and the bank will help it set up a mentorship programme to support women's careers and keep female staff. Neither release gives the tenor, pricing or security of the loans.
The EBRD has invested almost US$7.3bn (€6.5bn) in Uzbekistan through 219 projects, with most of the money going to private companies, the bank said. Its other recent Uzbek deals include a US$25m loan to Davr Bank for young entrepreneurs, and the government's own sale of state assets is set out in Boards and Capital's report on the privatisation decree PD-177.
A day earlier, the bank announced a €15m loan to Selzer Automotive Bosnia, a maker of metal components and assemblies for car transmissions, brakes and engines owned through the Selzer Group by the German investment company Mutares. Most of the initial loan will fund production of parts for electric and low-emission hybrid vehicles, including rotor shafts for electric motors and hybrid transmission components. The project also provides for training and jobs for at least 100 more workers, with a focus on young people and women, the EBRD said.
The announced facilities are up to US$30m for the two Uzbek companies and €15m for Selzer Automotive Bosnia. The releases do not say whether the borrowers will draw the full amounts at once.