Moscow, June 19, 2003—The International
Finance Corporation, the private sector financing arm of the World Bank
Group, signed an agreement today to provide an eight-year $15 million loan
to Stavropolsky Broiler, a poultry subsidiary of Agros, an agribusiness
venture established by the Interros group.
IFC’s financing is part of a $35 million project to rehabilitate and expand
commercial broiler production in the Stavropol region, the “bread basket”
of Russia. Agros recently acquired assets that form an integrated poultry
production chain. The project will rehabilitate these newly acquired assets,
improve bird breeding, strengthen management practices, increase production,
provide working capital, and expand the company’s distribution network.
During the past 12 months, IFC has also provided advice and technical expertise
to Agros on strategic development, corporate governance and other operational
issues. The technical assistance program was funded by IFC’s UK/DFID Trust
Fund for the project’s feasibility study to streamline its poultry operations
and enhance efficiencies along the integration chain and by IFC’s Netherlands/Senter
Trust Fund to help Agros implement a new MIS and set up a well functioning
finance and accounting department.
IFC’s loan to Agros reflects IFC’s strategy of increasing its support
to Russian-owned businesses and testifies to IFC’s increasing confidence
in the restructuring and growth of the Russian economy. “Our goal is to
build long-term partnerships with strong and reliable Russian producers
to facilitate private sector growth across Russia. We intend to build these
long-term partnerships through investments in private business groups that
have demonstrated commitment to improving transparency and corporate governance,”
commented Mr. Jean-Paul Pinard, Director of IFC’s Agribusiness Department.
"We are happy to see that our effort is supported by international
financial institutions. IFC's decision reflects a growing confidence in
Russian agriculture. We hope that the present agreement between Agros and
IFC marks a new stage in the modernization of the Russian agriculture business.
We are also especially grateful for continuous support of our Stavropol
project by the Russian Ministry of Agriculture and Governor of the Stavropol
region”, says Mr. Dmitry Ushakov, the Agros President.
The International Finance Corporation is a member of the World Bank Group.
IFC’s mission is to promote sustainable private sector investment in transition
economies, helping to reduce poverty and improve people's lives. IFC finances
private sector investments in the emerging markets, mobilizes capital in
the international financial markets, helps clients improve social
and environmental sustainability, and provides technical assistance and
advice to governments and businesses. Since its founding in 1956 through
FY02, IFC has committed more than $34 billion of its own funds and arranged
$21 billion in syndications for 2,825 companies in 140 developing countries.
IFC's worldwide committed portfolio as of FY02 was $15.1 billion for its
own account and $6.5 billion held for participants in loan syndications.
Russia joined IFC in 1993. Since then IFC has invested over $1.3 billion
to finance nearly 70 projects across a variety of sectors. IFC significantly
increased its investment program in Russia in the last two years, investing
$217 million in FY02 (July 1, 2001 – June 30, 2002) and over $500 million
this fiscal year. IFC’s increased activity reflects the improving investment
climate in Russia, greater opportunities in an increasingly broad range
of sectors, and stronger foreign investor interest.
Agros is Russia's largest private equity investment fund in agriculture
and foods industries. The company, owned by Interros holding and Agros
management, was established in October 2001 with $100 million in authorized
capital. Its managing company RosKhleboProdukt is responsible for the management
of the production and business units developed with the investments provided
by the Agros. Agros is mainly focused on grain trading and meat and poultry
products. The company is Russia's leading grain trader on both domestic
and foreign markets and is the second largest in terms of grain storage
capacity. Agros is the country's second largest poultry producer and the
third flour producer.