2010-07-16

Project will finance purchase of raw materials, energy efficiency improvements. The EBRD is providing a $50 million loan to one of Ukraine’s largest agro-industrial companies, focusing on the production of poultry and the cultivation of grain, with an investment that will boost demand for products from the local market and also make the company more energy efficient.

The financing for JSC Myronivsky Hliboproduct (MHP) consists of a $35 million working capital loan that will be used to purchase sunflower seeds and other raw materials that will be further processed and could also be used in the production of poultry meat. A further $15 million will be channelled to energy efficiency improvements. As a result of this project, MHP, wholly owned by a Luxembourg holding company MHP S.A, is expected to produce volumes of sunflower seeds and other grains.

The increased procurement will stimulate demand for company products and guarantee stable prices. Energy efficiency improvements envisage, in particular, the installation of a biomass boiler, the modernisation of the existing storage and the construction of new cold storage units at MHP’s meat processing plant. MHP is also planning to replace the existing energy intensive cooling equipment as part of the project. Gilles Mettetal, EBRD Director for Agribusiness, said: “By supporting MHP, the Bank maintains its focus on financing strong local companies and brands. The project also underscores the EBRD’s commitment to supporting energy efficiency initiatives across all the projects that it finances.”

Yuriy Kosyuk, CEO of MHP, said: "This transaction will serve to strengthen and support our expansion further. It will enable us to continue implementing our vertical integration strategy by expanding our operations to deliver high-quality products for the domestic market and run our business efficiently.” In the agribusiness sector alone, the EBRD has directly committed more than €6 billion in over 400 projects across central and eastern Europe and the Commonwealth of Independent States since 1991. The European Bank for Reconstruction and Development is the largest financial investor in Ukraine. As of 1 May 2010, it had committed over €5.0 billion through 197 projects.