EBRD to take decision Garadag decision, Azerbaijan

EBRD to take decision Garadag decision, Azerbaijan
Published: 26 April 2006

The EBRD Board of Directors will take decision on purchase of 20 per cent stake in the Garadag Cement JSC. The Agency has been informed at the Bank Office in Baku that 20 per cent stake is evaluated at $10m. EBRD intends to become medium-term stockholder of the JSC - for seven years. Holcim which privatized the Garadag Cement JSC applied to EBRD with offer on joint financing the second stage of reconstruction of the enterprise. Expenses for transition to the new technology will cost US$75m and duration of the project will last at least two years. 
 
Funds received from the sale of the stake to EBRD will be transferred to Holcim for installing electrostatic filter of kiln. Totally about US$100m will be invested in reconstruction of the cement enterprise and this will provide meeting the European ecological standards by the enterprise. 
 
Sales of stocks of the Garadag Cement OJSC will pertain chiefly to a batch of stocks of the Holcim Company, which shares currently about 89.4 per cent. Holcim bought the stake of the JSC in 1999. It borrowed US$23m from Breitenburger Auslandbeteiligung GmbH and has since invested a further US$40m. In 2005 Garadag reportedly made US$32m profit from an output of 1.3Mt.