CzechEBRDTurkish Business Meeting

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CzechEBRDTurkish Business Meeting
The EBRD and TURKEY

• Michael Davey
• Director, Turkey
• 11th December 2009

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What is the EBRD?

• Established in 1991
• International Financial Institution, promotes
  transition to market economies in 30 countries
  from central Europe to Central Asia
• Owned by 61 countries and two inter-governmental
  institutions
• Capital base of 20 billion
• The largest lender and private equity investor in
  Central Eastern Europe and CIS
• Turkey is our newest recipient country, as of 1st
  November 08

Projected
Unaudited as at 30 September 2009
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EBRD in 2009
billion

• Invested over 45.9bn in 2,748 projects since
  1991
• Private sector gt 77 of portfolio
• Debt 80, Equity 20 of portfolio
• 6.1bn invested in 2009 as at 30 September 2009
  ABV for year to reach 8bn

Annual business volume (ABV)
Net cumulative business volume
Unaudited as at 30 September 2009
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Project portfolio (cumulative commitments)
billon
35.2
29.4
10.7
7.4
2,748 signed projects
Disbursements
Unaudited 30 September 2009
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What is the EBRD?
Cumulative commitments 38.2 billion
Unaudited May 2008
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Net cumulative volume by sector
Unaudited as at 30 September 2009
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Operational Strengths of the EBRD

• Willing to share risks, including political risks
  
• Provides finance to both private and public
  sector clients
• Catalyst to access additional equity, debt and
  trade finance
• Extensive knowledge of local economy, business
  environment and practices
• Focus corporate governance incl. protection of
  minority interests

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Catalyst for change

• Every Euro of EBRD investment mobilises a total
  of 1 Euro for the project and 2 Euros when
  co-financed by an external source
• EBRD investments have attracted an additional
  96.3 billion from domestic and foreign investors
• The EBRD uses funding donated by member
  governments and institutions to assist project
  preparation and catalyse foreign investment

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EBRD Financing Solutions
Equity
Loans

• Common stock or preferred
• Minority position only (up to 35)
• Mezzanine

• Senior, subordinated, convertible
• LT (up to 10y or more) or ST revolving
• Floating/ Fixed rates
• Choice of currencies
• (EUR, USD, RUB etc.)
• Syndication Loan

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EBRD Projects with Turkish Sponsors

• As of 1st January 2009
• Over 30 projects in EBRD region
• Total project value 1.7 billion
• EBRD financing 1.3 billion
• Cooperation across the regions (Russia, Ukraine
  Uzbekistan, Tajikistan, Turkmenistan, Kazakhstan,
  Georgia, Bulgaria, Romania, Albania)
• Wide range of sectors (financial sector, energy,
  textile, white goods, packaging, property)

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• Turkey EBRD Country of Operation
• as of 1 November 2008 Turkey became EBRDs
  country of operations

• Operational priorities
• Improve the availability of risk capital and long
  term funding to the micro, small and medium sized
  enterprise sector
• Emphasise investment along the food chain
• Support the delivery of vital utilities to the
  population and enterprises in the regions of
  Turkey (Municipalities, Power Energy)
• Promote energy efficiency and renewable energy
  across economic sectors
• Support the Turkish governments privatisation
  programme in the enterprise and financial
  institutions sector.

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EBRD projects with Turkish Sponsors
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Major Turkish Companies have been working with
EBRD since 1996
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Rotor Wind Farm

• Client Rotor Elektrik Uretim A.S., owned by
  Zorlu Elektrik Uretim A.S. (incorporated in
  Turkey).
• EBRD finance up to 45 million.
• Tenor 13 years (including one year grace).
• Syndications/Co-Financing IFC, EIB and
  commercial banks participate in financing
  package.
• Use of proceeds to complete the construction of
  a 135 MW onshore independent wind power project
  in Osmaniye, Southern Turkey.
• Security lenders will receive pledge of shares.
• EBRD added value promotion of more widespread
  private ownership first large wind farm project
  financing in Turkey which will help Turkey
  towards meeting its renewable energy targets
  demonstration effect of new products and
  processes.

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A Turkish Sponsor Efes Breweries International

• Supported EBIs expansion in Russia and
  Kazakhstan. EBRD cumulative commitments to Efes
  Beverage Group since 1997 total over 95 million.
• Approx. USD 75 million loan and USD 6 million
  equity to help finance (mainly)
• i) Green-field 120 million litre brewery
• ii) Expansion continued investment in
  Russia
• iii) Acquisition of Amstar Brewery.
• Alongside EBRD, part of funds were provided
  Rabobank and ABN AMRO.
• Efes Kazakhstan USD 9.5 million loan to finance
  the construction of a 500,000 hectolitre
  green-field brewery in Almaty, Kazakhstan.

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Sisecam Glass packaging leader in Russia

• EBRD financed two glass-packaging projects in
  Russia for Anadolu Cam the glass-packaging arm of
  Sisecam. The Sponsor is the leading producer of
  glass bottles in both Turkey and Russia. Anadolu
  Cam has three plants in Russia, two of which were
  financed by EBRD.
• USD 48 million financing for Ruscam-Ufa a
  green-field plant in the State of Bashkortostan.
  The plant has a 240 thousand ton capacity p.a.
  and is the leading glass bottle supplier to
  breweries like in Central Russia. Funds were
  provided by EBRD, ABN AMRO and Calyon.
• USD 29 million financing for Pokrovsky PSZ to
  modernise the plant and invest in an additional
  furnace. Currently it has 200 thousand ton
  capacity p.a. The Sponsor acquired the plant from
  EBRD in 2004. Funds were provided by EBRD and
  ABN AMRO.

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A Turkish Sponsor in Romania PAK Holding

• EBRD Loan of US 7.5 million. First EBRD loan in
  1996
• To construct a green field yeast factory in the
  north east of Romania to produce high quality
  baker's yeast for the Romanian market
• Now fully repaid

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Poti Oil Products Terminal Project
Revitalising former prominent Black Sea cargo
port of Georgia

• 19.7 million A-B EBRD loan
• Building and operating a new oil terminal,
  including purchase and installation of oil tanks
  and equipment for the on-shore storage facility,
  construction of necessary infrastructure and
  terminal connection to the hinterland through
  transport routes.
• The terminal will serve the growing demand for
  export of oil products and derivatives from
  Central Asia and Azerbaijan to Europe, Africa and
  the US.

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A Turkish Sponsor in Central Asia Gap-Turkmen

• Initial EBRD finance (debt equity) of US 30.8
  million and total project cost is US 88.8
  million. With an extra equity finance of US 3
  million and debt finance of US 10.6 million
• Expansion of a denim weaving mill into an
  integrated plant making both fabric and
  ready-made garments. Capital increase to ensure
  the long-term future of the first vertically
  integrated denim fabric and ready-made goods
  production complex in Turkmenistan

Signed on January 1996, November 1999 and January
2002
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A Turkish Sponsor in Bulgaria and Macedonia
Migros Turk

• EBRD Loan of US 12.8 million (Bulgaria) and 7
  million (Macedonia).
• The loans financed rollout of new Bulgarian
  stores and a new shopping centre in central
  Skopje. The chain is managed across both
  countries.

Migros Turk (Ramstore)
Signed in 2000 and 2004
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A Turkish Sponsor in the Russian Federation
Vestel-Record

• EBRD loan of US 15m as part of a US 47.5m
  investment plan for the construction and
  operation of a TV set production line
• One of the largest high quality TV set production
  facilities in Russia to date
• Expected to promote competition both among local
  and foreign producers, which will raise quality
  standards and lead to a more efficient market
  environment, as well as the facilitation of
  technology and skill transfer

Vestel-Record TV set production
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Coca-Cola Almaty Bottlers in Kazakhstan

• Client Coca-Cola Almaty Bottlers, subsidiary
  of Coca-Cola Icecek owned and controlled by
  Anadolu Efes of Turkey
• Total value of project USD 110 M, of which EBRD
  Finance USD 40 M
• Tenor 5 years
• Use of proceeds expansion and modernisation of
  the Companys production facilities and
  distribution networks in Kazakhstan
• EBRD added value providing a consistent
  long-term strategy in support of FDI in difficult
  markets political comfort through free market
  orientation and through its constant dialogue
  with relevant authorities

Signed in 2008
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Krasnodar Glass Packaging Plant Senior Loan

• Client Ruscam-Kuban LLC, a greenfield company
  majority owned by Anadolu Cam (part of the
  Turkish SiseCam Group)
• EBRD Finance EUR 37.5 M loan to be provided in 2
  tranches of EUR 22.5 M and EUR 15 M
• Tenor 7 years
• Use of Proceeds to finance SiseCam Groups
  expansion in the Russian glass beverage container
  sector via construction of a greenfield glass
  bottling plant in Krasnodar.
• Syndications the loan will be syndicated to
  Sisecams house banks, Calyon and ABN AMRO
• EBRD added Value providing nearby regions with
  beverages in adequate containers promotion of
  bottles that require 20 less raw material for
  production development of upstream linkages
  through increased procurement needs

Signed in 2007
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Chisinau Shopping Mall in Moldova

• Client Lemi Invest, co-owned by Summa AS
  (Turkish) and Colonnafin BV (90 owned by Mr
  Husnu Ozyegin)
• Total value of project EUR 56 M, of which EBRD
  Finance EUR 42.8 M (A-loan and B-loan on 50-50
  basis)
• Tenor 12 years for A-loan, 10 years for B-loan
• Syndication EUR 21.4 M syndicated to commercial
  banks
• Use of proceeds construction of a shopping mall
  located near the city centre of Chisinau
• EBRD added value demonstration effect by
  introducing new standards in the retail and
  entertainment sectors

Signed in 2008
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Aura Shopping Centre in Russia

• Client SibStroyInvest, subsidiary of a new SPV
  set up in the Netherlands which is equally
  co-owned by Amstar Global Property Fund and
  Ilicak Family from Turkey
• EBRD Finance EUR 40 M
• Tenor 8 years
• Use of proceeds development of a class-A retail
  and entertainment centre located in Novosibirsk,
  the third largest city in Russia
• EBRD added value ideal long-term financing
  partner in the context of limited debt funding on
  a project finance basis during the financial
  crisis

Signed in 2009
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Efes Vitanta Brewery in Moldova

• Client IM Efes Vitanta Moldova Brewery, 96.5
  owned subsidiary of Efes Breweries International
  owned by Efes Beverage Group in Turkey
• Total value of project USD 24 M, of which EBRD
  Finance USD 18 M
• Tenor 6 years
• Use of proceeds modernization and expansion of
  the Companys brewing capacity construction of a
  waste water treatment facility
• EBRD added value long-term financing partner
  that provides a consistent long-term strategy in
  support of FDI in difficult markets

Signed in 2008
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Ruscam - Kirishi Project in Russia

• Client Ruscam-Kirishi which is majority owned by
  a SPV (Balsand) owned by Anadolu Cam, member of
  the Turkish SiseCam group
• EBRD Finance EUR 21.03 M divided into A and
  C loans
• Tenor 5 years
• Syndication EUR 20 M syndicated to commercial
  banks
• Use of proceeds construction of an additional
  furnace as well as a cold repair and expansion of
  the existing furnace in the plant in Kirishi
• EBRD added value record market knowledge and
  regional-specific experience of the Bank

Signed in 2009
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Deep global crisis, slow recovery

• Regions output to fall by 6.3 per cent in 2009
• Double-digit declines expected in five countries
  (Armenia, Estonia, Latvia, Lithuania, Ukraine)
• Continuing credit crunch, bad debts, joblessness
  on the rise
• Slow, patchy recovery, but with considerable
  variation across countries

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How to contact us

• Michael Davey
• EBRD
• Büyükdere Caddesi 185, Kanyon Ofis Binasi,
  Levent, Istanbul 34394
• Tel [phone]
• Fax [phone]
• Email daveym_at_ebrd.com