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Moscow, June 9, 2005
—The International Finance Corporation (IFC), the private sector financing arm of the World Bank Group, signed an agreement to provide $100 million in long-term debt to the Russkiy Mir Group, including an A loan of $45 million for IFC’s own account and a B loan of $55 million which will be underwritten by Natexis Banques Populaires. This is IFC’s second investment in the Group. The Russkiy Mir Group will invest IFC’s funds to develop the Taman liquefied petroleum gas (LPG) and fuel oil terminal complex and to make rail-related investments.
The Russkiy Mir Group is a privately owned Russian rail transport group and has been active in the oil transportation market for over 14 years. The Group leases rail tank cars to Russian oil industry companies, which utilize the cars to transport crude oil and oil products, and provides rail car maintenance services. With the development of the Taman terminal, Russkiy Mir will significantly expand its energy transportation capabilities. The Taman terminal will be Russia’s first LPG terminal.
Francisco A. Tourreilles, IFC’s Infrastructure Department director, noted, “This is IFC’s second investment in Russkiy Mir, a group that is playing a key role in energy transportation logistics in Russia and making an important contribution in helping to relieve bottlenecks and increase volumes in this important export sector. We expect that over the next several years, private investment in Russia's rail industry will continue to play a critical role in its modernization and expansion.”
“By supporting a leading private Russian rail car leasing company and its expansion into other energy transportation activities, such as the Taman terminal, this investment will contribute to the development of the country’s transportation infrastructure. We look forward to working with the Russkiy Mir Group in supporting their future investments,” said Edward Nassim, IFC’s director for Central and Eastern Europe.
Michal Litwak, president of the Russkiy Mir Group, pointed out the importance of having IFC as a partner, “Our group is committed to improve upon the quality of transportation services available to Russia's oil companies and having IFC as an investor is an important part of that commitment. Further, IFC has provided assistance in developing best practices with respect to technical, social, and environmental matters, which is of critical importance as we develop the Taman terminal.”
Since Russia became a shareholder of IFC in 1993, the Corporation has invested $1.9 billion there for its own account, plus an additional $292 million in syndicated loans, in about 100 projects across a variety of sectors. IFC investments are spread across Russia’s most important sectors, including banking, leasing, housing finance, infrastructure, mining, agribusiness, pulp and paper, construction materials, oil and gas, telecommunications, information technologies, retail, and health care.
The mission of IFC (
www.ifc.org)
is to promote sustainable private sector investment in developing countries, helping to reduce poverty and improve people’s lives. IFC finances private sector investments in the developing world, mobilizes capital in the international financial markets, helps clients improve social and environmental sustainability, and provides technical assistance and advice to governments and businesses. From its founding in 1956 through FY04, IFC has committed more than $44 billion of its own funds and arranged $23 billion in syndications for 3,143 companies in 140 developing countries. IFC’s worldwide committed portfolio as of FY04 was $17.9 billion for its own account and $5.5 billion held for participants in loan syndications.
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