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Equity Participation in ADM CEECAT Recov

Albania, Armenia, Azerbaijan, Bulgaria, Georgia, Moldova, Romania, Russia, Türkiye, Ukraine | Financial Institutions

Identification Code:: OP/11/0822
Total Operation Cost:: 186.375.000 EUR
Maturity:: 60 months
Operation Status:: BSTDB Approved Amount – Approval Date

15.000.000 EUR – 21 Jul 2011
: BSTDB Signed Amount – Signed Date

15.000.000 EUR – 29 Jul 2011
: Status:
Completed
Description and Purpose of the Operation:: ADM CEECAT Recovery Fund is a EUR 265,375,000, private equity fund which covers, among others, all BSTDB member countries except Greece, with focus on Bulgaria, Russia, Turkey and Ukraine. The Fund's investments focus on rehabilitating operationally strong but financially distressed companies via restructuring, rescheduling, refinancing, debt-equity swaps, liquidity management. It also will fund growth opportunities where alternative sources of capital are not available. From among BSTDB Member Countries, the Fund will initially target companies in Bulgaria, Russia, Turkey and Ukraine with loans and equity investments in the range EUR 10-30 million. The Fund has developed already a strong presence in Turkey and has built a pipeline of potential new deals in other countries in the Black Sea region.
Countries of Operation:: Albania (63,01%), Armenia (63,01%), Azerbaijan (63,01%), Bulgaria (10,57%), Georgia (63,01%), Moldova (63,01%), Romania (8,40%), Russia (22,53%), Türkiye (40,98%), Ukraine (14,36%)
Financial Product:: Equity Investments
Sector:: Financial Institutions
Domain:: Private
Borrower/Client:: ADM CEECAT Recovery Fund LP
Co-Financers/Participants:: EBRD, IFC, EIF and FMO
Guarantors/Sponsors:: —
Developmental and Regional Cooperation Impact:: Investing in distressed companies with the aim of corporate recovery has high development impact. Distressed companies that receive liquidity get the opportunity to de-leverage or restructure their balance sheets, induce managerial and operational improvements and become economically viable again. ADM Capital views the improvement of corporate governance and transparency of investee companies as a key element in the recovery process. Therefore, BSTDB's investment in the Fund will enable the Bank to promote (through ADM) better management of investee companies. The impact of the recent financial crisis in the region has created an environment where ADM Capital's style of investing can bring significant value to the growing number of companies, including SMEs, facing difficult access to finance. By supporting strong companies that encounter funding difficulties, the Fund would have a positive stabilizing impact on the businesses of the investee companies, will help maintaining jobs and production, contributing to the overall economic stability of the region.
Environmental Classification and Impact:: According to the Bank's environmental screening the Operation has been assigned category FI. The Environmental Assessment showed that its managers are well acquainted with EH&S implications of their investments and are considering these risks and impacts during the Due Diligence process along the financial and legal issues. The Fund's Investment Policy has a strong focus on promoting investments which will strengthen corporate governance and environmental sensitivity. It also commits to comply with EBRD's and IFC's Environmental and Social Policies (similar to BSTDB's relevant documents) and not enter into any Investments specified in the Exclusion Lists of these institutions, will adopt and implement environmental and social due diligence and monitoring policies, and furnish to the Advisory Board annual reports on environmental and social matters.
Operation Leader:: General Industries, Transport, Tourism 2
E-mail:: gitt2@bstdb.org