June 23, 2006, St. Petersburg, Russia—The
International Finance Corporation, the private sector arm of the World
Bank Group, is providing a financing package totaling $119.5 million to
the Eurosib Group, one of the country’s leading private railroad and logistics
operators. The investment will support the first phase of the development
of Russia’s first private network of inland logistics terminals.
The investment package consists of a long-term senior loan of $33 million
for IFC’s own account, a syndicated loan of $71.5 million for participating
banks, and a subordinated loan of $15 million for the account of IFC. The
long-term syndicated finance is provided by Citigroup, inc. as mandated
lead arranger; HVB Group and Raiffeisen Zentralbank Österreich AG as lead
arrangers; BayernLB as co-arranger; and Raiffeisenlandesbank Niederösterreich-Wien
AG as manager.
Eurosib Group will use IFC financing to build and operate six inland container
terminals at cargo processing hubs in the Urals, Siberia and outside Moscow
and St. Petersburg. This is the first phase of Eurosib’s multi-stage
terminal development program. The group plans to build approximately 20
terminals in Russia and the Commonwealth of Independent States.
Each terminal will have a rail and road connection, a warehouse, and a
container yard designed to handle up to 60,000 20-foot containers per year.
“Upgrading the transportation and logistics infrastructure is a priority
for Russia to maintain its growth. The construction of Eurosib’s
inland terminal network will contribute to further development of local
multimodal transport services and will have a substantial positive impact
on the Russian economy through lower transport costs and more efficient
intermediation of goods,” said Francisco Tourreilles, the director of
IFC’s infrastructure department. “IFC is very pleased to be working with
Eurosib on this second investment in the group’s transportation and logistics
“Our project has benefited from IFC’s ability to structure complex transactions
and attract additional resources from international financial markets,”
said Dmitry Nikitin, general director of Eurosib. “Eurosib’s main goal
is to provide high quality comprehensive logistics solutions to a variety
of domestic and international clients, and IFC’s financial support has
been instrumental in our efforts to attain this objective.”
“IFC’s partnership with Eurosib Group is a good example of our strategy
in Russia to support local businesses and assist them in reaching their
potential,” said Edward Nassim, IFC’s director for Central and Eastern
Europe. “Eurosib is a dynamic company with significant growth prospects
in an area critical to Russia’s further economic development.”
About Eurosib Group
Established in 1992, Eurosib is a locally
owned group of companies headquartered in St. Petersburg primarily engaged
in rail transportation, freight forwarding and logistics. The group also
owns and operates several car dealerships in the St. Petersburg area.
Eurosib owns and/or operates a fleet of over 12,000 railcars for dry cargo.
The network of inland container terminals will build on the group’s transportation
and freight forwarding operations providing cargo consolidation, storage
and distribution services to various domestic and foreign clients. The
terminals will be connected through scheduled container block trains operated
For more information, visit www.eurosibspb.ru.
The International Finance Corporation
is the private sector arm of the World Bank Group and is headquartered
in Washington, D.C. IFC coordinates its activities with the other
institutions of the World Bank Group but is legally and financially independent.
Its 178 member countries provide its share capital and collectively
determine its policies.
The mission of IFC is to promote sustainable private sector investment
in developing and transition 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 FY05, IFC has committed more than $49 billion of its own
funds and arranged $24 billion in syndications for 3,319 companies in 140
developing countries. For more information, visit www.ifc.org.
IFC manages environmental and social risks associated with the projects
it finances through standards that its clients companies are required to
apply. In collaboration with client companies, IFC looks at business opportunities
arising from the protection of the environment and from social development.
IFC also explores and develops new financial products that create new business
opportunities linked with the environment and social development.
IFC in Russia
Russia became a member and a shareholder
of IFC in 1993. Since then IFC has invested $2.9 billion in the country,
including $527 million in syndicated loans, in over 110 projects across
a variety of sectors. In FY05 (July 2004–June 2005) IFC’s investments
reached $832 million. IFC’s investment portfolio in Russia currently stands
at $1.8 billion, making it the largest country exposure for IFC globally.
IFC has invested in key sectors including banking, leasing, housing finance,
infrastructure, mining, agribusiness, pulp and paper, construction materials,
oil and gas, telecommunications, information technologies, retail, and
health care. For more information, visit www.ifc.org/europe.