Arkhangelsk PPM and UniCredit Bank Austria AG, part of UniCredit Group, signed two loan agreements with a total amount of more than EUR 80 million for a period of 10 years covered by the Finnish ECA Finnvera.
The funds raised will be used during 2017-2018 to finance the program of technical re-equipment of the Arkhangelsk Pulp and Paper Mill, in particular the construction of a new evaporator plant and the reconstruction of the cardboard machine No. 2. Both projects are an important part of the priority investment project in the field of forest development "Reconstruction of cardboard production" registered by the Ministry of Industry and Trade of the Russian Federation.
Oleg Gubin, the finance director of the plant, said that the closure of these deals is a significant event not only for the APPM, but for the pulp and paper industry in general – as there have not been many such large projects on the market in recent years. "Together with the colleagues from the largest financial and insurance institutions in Europe as well as with the representatives of the seller we have done a tremendous job structuring the deal and agreeing on the main terms of the loan agreements," Oleg Gubin said., “The result of these efforts is the signing of these two contracts which combine unique financing terms both in terms of credit period of ten years and of financial costs for its support taking into account the fee of the ECA."
Heinz Zinner, the Chairman of the Board of Directors of Arkhangelsk Pulp and Paper Plant, said that the company has a good credit history and long-standing partnership with UniCredit Group. "Pulp Mill Holding as the main shareholder of APPM is constantly reinvesting all the company's profits in the technical re-equipment program as it understands the priority of technical progress and the best available technologies as well as the improving of the environment," concluded Zinner.
"UniCredit Group has been financial partner of Pulp Mill Holding and its leading enterprise Arkhangelsk Pulp and Paper Mill for many years. The closure of the new deal is an important event for the pulp and paper industry. It is also an excellent example of a complex structured transaction which UniCredit Group successfully implements for the benefit of clients from a wide range of industries, helping them raise funds for large-scale and long-term projects on optimal terms," said Kirill Zhukov-Emelyanov, Member of the Management Board of AO UniCredit Bank, the Russian bank of UniCredit Group,
Until 2020 the total investment of APPM will be more than 23.0 billion rubles. The company realizes the second stage of the priority investment project "Reconstruction of cardboard production" worth 8.8 billion rubles included by the Ministry of Industry and Trade of the Russian Federation in the list of the priority projects for the Russian economy.