The United Sugar Company of Egypt, a subsidiary of Savola Group, received a $100m investment from the European Bank for Reconstruction and Development (EBRD), the bank announced Tuesday.
“The bank will convert an existing US$ 50 million loan to United Sugar Company of Egypt S.A.E. (USCE) into equity and provide the company with an additional US$ 50 million in share capital,” the EBRD said.
The investment will be used to enhance the company’s operation and competitiveness in the market as well as to assist the company in meeting international standards with regards to health and environmental practices.
“By converting the EBRD’s original loan into equity, USCE will strengthen its balance sheet and reduce its exposure to foreign currency-denominated debt,” the EBRD said. “The additional $50m in equity will be used to finance the company’s working capital, thus helping company’s exports and local sales in extremely tough market conditions.”
The head of agribusiness for the southern and eastern Mediterranean at the EBRD Tarek El Sherbini said the partnership with Svaola started in Kazakhstan and has now extended to Egypt.
The bank recently signed several loans and agreements with Egyptian companies, banks, and the government.
In November 2015, the bank provided the Egyptian Electricity Holding Company (EEHC), through the West Delta Electricity Production Company (WDEPC), with a $200m loan. Later that same month, the bank allocated €1bn to finance small and medium-sized enterprises in Egypt’s automotive sector.
The previous loans were followed by a $500m loan to support Egypt’s new solar energy programme. Minister International Cooperation Sahar Nasr signed a €100m financing agreement aimed at improving the second line of the Cairo metro system.
The director of the EBRD in Egypt, Philip ter Woort, has previously said that the bank is committed to ensuring that its activities in support of enterprises are available across the country.
Up to the end of 2012, the investments of the EBRD in Egypt totalled €1.6bn across 31 projects.