EBRD provides EUR 20 million senior secured loan to Winner

EBRD, Kyiv, Ukraine, Tue, May 25, 2021
Winner Group in a member of U.S.-Ukraine Business Council

Project Description

EUR 20 million senior secured loan to Winner Group, US-owned leading Ukrainian importer and retailer of several well-known international vehicle brands. Financing will focus on green economy transition and circular economy through investments in new sustainable dealerships for Renault and Volvo, expansion of client's logistic capacities, distribution and service infrastructure for vehicles, including electric.

Project Objectives

All building financed by the Bank will obtain BREEAM or EDGE sustainable certification. Project contributes to the adoption of advanced green practices in a country where such standards and practices are still uncommon, for instance, according to the latest data, only 12 BREEAM certificates have been issued in Ukraine to date with only one certificate issued in the retail category.

Transition Impact

ETI score: 62

- Green: all buildings financed by the Bank will obtain BREEAM or EDGE certification, which will contribute to the Group's improved energy performance.

- Integrated: US shareholders will make substantial new contribution towards program's implementation at times when Ukraine experiences net FDI's outflow.

Client Information

WINNER IMPORTS UKRAINE LLC

Winner Imports Ukraine, is the largest company of Winner Group (the Group), a foreign direct investment with US capital and a leading Ukrainian importer and retailer of vehicles. The Group is widely recognised locally for setting higher standards of transparency and responsibility.

EBRD Finance Summary

EUR 20,000,000.00

Total Project Cost

EUR 43,000,000.00

Additionality

EBRD offers financing not available from the commercial banks, provides mechanisms for risk mitigation and helps to achieve higher standards including environmental and energy efficiency.

Environmental and Social Summary

Category B (2014 ESP). Environmental and social due diligence (ESDD) has been undertaken by the Bank's Environment and Sustainability Department based on a review of all available information, including a review of corporate management systems, interviews with the Company's representatives and a site visit. The review covered the existing facilities, and confirmed that they are in satisfactory condition and generally meet the Bank's Performance Requirements. All operational facilities are located in an urban area and do not have negative impacts on any sensitive receptors.

A review of the Company's corporate management system showed that it has well-established and integrated EHS management systems that have been developed in line with good international practice, and have been implemented throughout their operations. Coordination, oversight and monitoring functions provided by the Company seek to ensure consistency in the approach to, and the management of, key EHS issues for new projects and operational activities. The Company has demonstrated its commitment to implement the Project in line with national and international environmental standards. Given the quality of their corporate management systems, it is expected that the environmental and social impacts associated with the Project will be readily mitigated and properly managed.

ESDD confirmed that all vehicles imported and distributed by the company comply with the highest vehicle safety rating under the European New Car Assessment Programme.

An Environmental and Social Action Plan (ESAP) has been agreed with the Company to address the mitigation measures and improvements which will enable the Company to comply with the Bank's PRs. As part of the ESAP the Company will implement the following actions:

Maintain and continuously implementation of the principles of Corporate EHS management system at project level in line with ISO 14001, OHSAS 18001 and relevant EBRD PRs and develop EHS training plan for employees involved in the operation of new facilities and ensure its implementation.
Obtain all necessary Environmental, Sanitary, H&S and Fire safety permits prior to operation of the new facilities.
Carry out regular internal Environmental and Fire, H&S audits according to the national and EBRD requirements and ensure timely and effective implementation of the notices from Environmental, Sanitary, Health&Safety and Fire Safety state authorities.

The Company will undertake local disclosure of its environmental and social performance to the local public and report on that to the Bank on annual basis.

The Bank will monitor the Company's environmental and social performance and implementation of the ESAPs through annual E&S reports.

Technical Cooperation and Grant Financing

The preparation of the transaction has been supported with an energy audit with the help of Taiwan Business TC Fund and EU funding for Recovery TC funds partially covering legal due diligence costs.

In addition, a first loss guarantee of 20% will be provided through the EU-EBRD Municipal, Infrastructure and Industrial Resilience Guarantee Programme. The Guarantee Programme is funded by the European Union under its European Fund for Sustainable Development (EFSD). Through the EFSD, the EU supports investments in its neighbouring countries and in Africa to help achieve the sustainable development goals. In line with this objective, the EU-EBRD Programme supports sustainable investments in green city infrastructure, greening logistics chains, energy efficiency and green technology transfers in industrial processes, commercial operations and buildings.