|
|  |
| Rubliovskiy |
|
| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 25180 |
| Company name | Millex International |
| Country | Belarus |
| Sector | Wholesale and Retail Trade |
| Environmental category | B |
| Department | Global Manufacturing & Services |
| Status | Active |
|
| Date SPI disclosed | March 17, 2008 |
| Projected board date | April 17, 2008 |
| Previous Events | Invested: September 11, 2008
Signed: June 6, 2008
Approved: May 22, 2008 |
|
| View Environmental & Social Review Summary (ESRS), click here |
|
| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
The project will comprise:
- the opening of 20 new Rubliovskiy supermarkets in Minsk and the regions;
- the construction of 6 new Class A and B+ warehouses in Belarus; and
- the development of a logistics business.
The project will roll out in phases between 2008 and 2012 at a total estimated cost of $110 million. |
|
| Project sponsor and major shareholders of project company |
| RTL Holdings (the Group) is a corporate designation that refers to the companies, including the Rubliovskiy brand supermarkets, controlled by Millex International Ltd. (Millex or the sponsor), that undertakes the retail, distribution and logistics activities of the Group in Belarus. |
| Total project cost and amount and nature of IFC's investment |
The total project cost is $110 million. IFC’s investment will comprise of:
- a $7 million A loan; and
- a $19 million mezzanine, C loan investment.
The balance of the financing will be provided through a combination of third-party debt, sponsor’s equity and internal cash generation. |
| Location of project and description of site |
| The project will be located throughout and in the proximity of the six main city centers of Belarus. |
|
| Anticipated development impact of the project |
The project will have the following development impact:
Benefits to Consumers:
By enhancing its wholesale business and expanding its retail chain, the Group will be able to provide access to a more diverse selection of high-quality, affordable food.
Best Practice Transfer:
The project is expected to facilitate the transfer of modern wholesaling, warehousing and retail techniques to Belarus and to enhance the efficiency of the supply chain in the country. The expansion of the Group's retail chain would demonstrate modern retailing techniques to the market.
Improved Corporate Governance:
The Group’s reorganization and improvement of its corporate structure as well as its transition to IFRS accounting will increase transparency and serve as a benchmark for other local companies.
Cost Savings for Consumers:
A stronger bargaining position vis-à-vis suppliers, economies of scale achieved through geographical expansion, as well as improved inventory management, will allow for cost savings, which eventually can be passed onto the end customer.
Employment Generation:
The project will create new employment, both directly and indirectly. It will provide additional direct employment through the expansion plan and temporary employment during the construction phase. |
 |
| IFC's expected development contribution |
IFC’s investment will help implement the project by:
- supporting a successful private Belarus Group expand, diversify and raise its operations to international standards;
- providing technical advice;
- facilitating upstream development of local manufacturers and wholesalers in the retail value chain by offering them increased access to customers;
- assisting the Group improve its environmental and social standards, including labor practices, in existing operations thus seeking to establish a good practice example in Belarus’ private sector in these areas. |
| Environmental and social issues - Category B |
The project is a category B investment according to IFC’s Environmental and Social Review Procedure. A summary of IFC’s environmental and social review findings for the project including the rationale for the B categorization is publicly available in the Environmental and Social Review Summary.
The key environmental and social aspects of the project, which have been considered are the following:
- Social and Environmental management systems and structure;
- Labor and working conditions;
- Life and fire safety;
- Food hygiene.
Measures to mitigate potential risks and impacts identified during the appraisal are publicly available in the Environmental and Social Action Plan. |
|
| For inquiries about the project, contact: |
Ekaterina Rogova, Secretary of the Representative Office
Millex International Limited in Belarus
Telephone:+375 17 237-93-48
E-mail: info@ rtl.by
Website: www.rtl.by |
|
| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
| Local access of project documentation |
| The Group will inform the local community on E&S aspects of the planned development through local disclosure of the ESRS and the ESAP on company’s website: www.rtl.by. |
|
|
|
|