EBRD OKs USD 36 mln loan to Sadovaya Group

The European Bank for Reconstruction and Development’s board of directors, at a meeting yesterday, approved a loan of up to USD 36 mln for Ukrainian coal miner Sadovaya Group (SGR PW). Loan proceeds will be used to finance Sadovaya’s USD 48 mln coal waste recovery project. Sadovaya owns 10 coal waste deposits containing 7.9 mln mt of measured and indicated resources (sellable coal) as of end-2010, and is planning to expand its waste resource base further. The EBRD-financed project, if realized in full, would allow the company to construct four enrichment facilities of 3.6 mln mt in aggregate waste processing capacity to produce about 1.0 mln mt of marketable coal from waste. Alexander Paraschiy:Though news of the loan’s approval was widely expected, we believe it could become a catalyst for the stock, which closed yesterday at an all-time low of PLN 7.9. We are still expecting the company to disclose further details on its waste recovery development plan.