The EBRD is supporting capital markets development in the Baltic states with a €40 million investment in a corporate debut bond issued by Lithuanian retailer Maxima Grupė.
The proceeds of the bond will help Maxima Grupė to refinance short-term financing for the acquisition of Polish retailer Emperia Holding, which was concluded earlier this year and enabled it to significantly expand its regional presence.
Maxima Grupė is the leading retail chain in the Baltic states, the largest employer and the second largest corporate in Lithuania. Maxima Grupė’s store network includes over 1,000 stores in the Baltic states, Polandand Bulgaria.
The acquisition of Emperia Holding enables Maxima Grupė to increase its scale and competitiveness on a regional level, while also fostering international trade by offering more local suppliers access to the Baltic states and Polish markets.
The bond will be the first bond issuance of this size by a private sector company from the Baltic states. The bond of €300 million will be dual-listed on the Euronext Dublin and NASDAQ Vilnius stock exchanges.
The successful placement of the bond is a strong signal about the potential of the Baltic states’ capital markets, where the countries are committed to establish a regional capital market to harmonise regulations and dismantle investment barriers.
The transaction follows the recent capital market transactions where the EBRD invested €30 million into each of the two green bonds issued by Lithuanian utilities company Lietuvos Energija in 2017 and 2018.
The EBRD has been working in the Baltic states since 1991 and to date has invested some €2 billion in more than 250 projects in Estonia, Latvia and Lithuania. Strengthening private enterprises and developing the capital market are among the Bank’s priorities in these countries.
Arvid Tuerkner, EBRD Managing Director in Turkey, said: “Renewable energy remains an attractive investment in Turkey. Our new financing supports Akfen Holding’s ambition to become one of the largest producers of renewable energy in the country. It is yet another boost to the sector as Turkey is switching to domestically sourced power generation.”
Harry Boyd-Carpenter, EBRD Director, Head of Power and Energy Utilities, said: “We are delighted to support Akfen in these important projects. Their size and the speed of their implementation highlight the scale of the energy transition which is bringing secure, clean and affordable energy to Turkey.”
Supporting this project is part of the EBRD’s larger efforts to help Turkey increase its share of renewables in the energy mix. In line with its renewable energy action plan developed by the country’s Ministry of Energy and Natural Resources with the support of the EBRD, Turkey aims to install 27 GW of non-hydro renewable generation capacity by 2023, 20 GW of which is expected to be wind and 5 GW licenced solar.
The EBRD is a major investor in Turkey. Since 2009 it has invested nearly €11 billion in various sectors of the Turkish economy, with almost all investment in the private sector. Half of the Bank’s portfolio in Turkey constitutes investments that promote sustainable energy and resource use.
It’s because we help drive innovation in both the public and private sectors that the World Bank Group is an especially valuable partner in African countries. I am confident that through partnership and commitment across the development community—as demonstrated by this month’s Forum and so many other efforts—we can greatly increase private investment and accelerate the work to transform economies in the countries we serve.
SUBMITTED BY By Axel Reiserer