IUD Receives USD 50 mln Of USD 150 mln EBRD Loan
1 March 2008
European Bank of Reconstruction and Development (EBRD) announced this week that Calyon Bank had provided the Industrial Union of Donbass (IUD) with the first trench of a USD 150 mln syndicated loan as part of its credit project with the business group. IUD is to use the funds to build a combined power & heat plant (CHP) at Alchevsk Iron & Steel (ALMK: BUY). The project cost is estimated at USD 383 mln. Apart from the EBRD, it will be financed by the Japanese Bank of International Cooperation (JBIC) who will give a USD 120 mln credit to IUD, and IUD’s own funds in the amount of USD 113 mln. The unit is expected to go online in 2009. By that time, Alchevsk Iron & Steel hopes to raise its steel making capacity by 88% to 7.5 mln mt p.a. Andriy Gostik: We estimate that the CHP will slash production costs by ~5% and make ALMK and its coke supplier, Alchevsk Coke (ALKZ: BUY) fully self-sufficient in electricity.
