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| Summary of Project Information (SPI) |
| This Summary of Project Information 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. |
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| Project number | 24437 |
| Project name | Asnova |
| Country | Ukraine |
| Sector | Wholesale And Retail Trade |
| Department | Global Manufacturing & Services |
| Company name | LLC Savservice Center |
| Environmental category | B |
| Date SPI disclosed | November 21, 2005 |
| Projected board date | December 27, 2005 |
| Status | Active |
| Previous Events | Invested: October 12, 2006
Signed: June 13, 2006
Approved: March 10, 2006 |
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| Description of company and purpose of project |
LLC Savservice Center (Savservice Center or the company) is a Ukrainian company involved in the distribution, warehousing and logistics of fast-moving consumer goods. Savservice Center carries out its activities under the trade names of “Savservice”, “Komora-S” through a network of 18 fully-owned subsidiaries, including 16 distribution companies present in 13 regions throughout Ukraine.
To support its operations, the company owns and operates warehousing and logistics facility in Kyiv, maintains a fleet of leased and owned vans and employs approximately 2,400 people. In addition, the company rents warehouse space from third parties both in Kyiv and throughout Ukraine.
To respond to the booming demand for high-quality modern distribution, warehousing and logistics services in Ukraine, Savservice Center is implementing a capital investment program (the “Project”), which contemplates the construction of a new warehouse and customs terminal at the company’s existing warehousing and logistics facility, the acquisition and renovation of a warehousing center near Kyiv, investments in vehicles and a management information system. |
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| Project sponsor and major shareholders of project company |
| The sponsor of the project is CJSC Asnova Holding (“Asnova” or the “Sponsor”), which fully owns the company. Asnova was founded in 1992 and is currently owned by a group of 9 Ukrainian businessmen. In addition to Savservice Center, Asnova is the owner of DC, a leading home care and personal care retail chain in Ukraine, as well as a number of other businesses most of which are involved in retail and/or distribution activities. |
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| Total project cost and proposed IFC investment |
| The estimated cost of the project is approximately $18.5 million. IFC is considering a $6 million A loan and a $2 million C loan to the company. |
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| Location of project and description of site |
Most of the investments contemplated by the project will be made at two sites: the “Esma” site and the “Kalynivka” site. The “Esma” site, which accommodates the company-owned warehousing and logistics facility, as well as the company’s headquarters, is located at 27, Krasnova Street, Kyiv. The “Kalynivka” site is located in an industrial zone in the vicinity of Kyiv at 5, Industrialna Street, Kalynivka, Kyiv Region.
In addition to operations in Kyiv, the company has subsidiary distribution companies in Bila Tserkva, Dnipropetrovsk, Cherkasy, Chernigiv, Chernivtzi, Khmelnytzky, Lutzk, Lviv, Ivano-Frankivsk, Rivne, Ternopil, Uzhgorod and Zhytomyr. |
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| Project Development Impact and IFC's Role |
The project would contribute to the increase in availability of modern distribution, warehousing and logistics services in Ukraine. Access to quality services will help lower overhead costs for both suppliers and retailers of fast-moving consumer goods. This benefit is especially valuable for the fast-moving consumer goods suppliers and retailers in Western Ukraine, which has been the company’s focus area. In addition, the development impact of the Project is expected to include the following benefits:
- the project would help address the issue of shortage quality warehousing space in Kyiv;
- the project will directly create more than 200 new jobs;
IFC Role: By providing long-term debt financing otherwise not available for the company, IFC would enable Savservice Center to proceed with its strategically important expansion while remaining financially sound. In addition, IFC will help the company enhance its financial structure through restructuring part of the existing debt and improving further the corporate environmental, health and safety structure. |
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| Environmental and social issues - Category B |
The review of this project consisted of appraising technical, environmental and social information submitted by the company and visiting the “Kalynivka” and “Esma” sites. The following potential environment, health and safety and social impacts of the projects were analyzed.
- Environmental management procedures.
- Land acquisition and planning procedures;
- Emissions to air and water;
- Solid and hazardous materials management;
- Occupational health and safety, including fire protection and emergency response;
The company has presented plans to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements - the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines. The information about how these potential impacts will be addressed by the sponsor/project is summarized in the Environmental Review Summary (ERS).
To view the environmental documents for this project, click here |
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| Location of environmental documents in locally affected community |
Environmental documentation will be made available at the following location:
Krasnova 27 street in Kiev. |
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| To contact the project company, please write to: |
Urfan Guliev,
27, Krasnova Street, Kyiv, 03115, Ukraine
Tel: 38 044 452-9886
E-mail: guliev.u@asnova.com |
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