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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 | 24082 |
| Project name | Transport Trade Services |
| Country | Romania |
| Sector | Transportation And Warehousing |
| Department | Infrastructure |
| Company name | C.N.F.R. NAVROM S.A. GALATI |
| Environmental category | B |
| Date SPI disclosed | June 13, 2005 |
| Projected board date | July 15, 2005 |
| Status | Active |
| Previous Events | Invested: November 1, 2005
Signed: September 20, 2005
Approved: August 11, 2005 |
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| Description of company and purpose of project |
Transport Trade Services S.A. (TTS or the company), its shipping subsidiary CNFR Navrom Galati S.A. (Navrom), its other subsidiaries and affiliates (the Group) are leading providers of freight forwarding, river shipping and integrated logistics services in Romania. TTS was founded in 1997 and its core operations entail the provision of shipping and handling (river, rail and sea) services to top tier Romanian and multinational clients.
The Group is currently undertaking a $25 million capital investment program consisting of:
- upgrading of engines and propulsion systems for twelve pushers;
- building a grain storage and handling terminal in Constanta; and
- refinancing the purchase of a 25 ton second hand floating crane.
The project will improve TTS’ logistics infrastructure and asset quality, strengthen its product offering and enhance the modular nature of its services. The investment program will also improve the Group’s efficiency, enhance reliability, allow it to service more clients and reduce operating costs. |
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| Project sponsor and major shareholders of project company |
The Group is a Romanian owned and operated integrated logistics and transport provider. Of the two main companies, TTS is privately held and Navrom is publicly listed on RASDAQ, the Romanian electronic exchange. TTS has 15 individual shareholder, 12 of whom are part of the company’s management.
Its five primarily shareholders, Mr. Mircea Mihaelescu (45.5%), Mrs. Lucia Barbalescu (10%), Mr. Ion. Stanciu (10%), Mr. Viorel Stefan (10%), Mr. Peter Hungerbuhler (10%), together own 85% of the Company. Mr. Mihailescu is also the founder and CEO of TTS. Navrom is 53.7% owned by TTS, 6.13% by Transfer International Services, 9.86% by SIF Transilvani, 5.11% Transorient, 0.14% by Constantin Hartan, the CEO and 25.05% by public shareholders. |
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| Total project cost and proposed IFC investment |
The total project cost is $24.7 million and consists of :
- $15.6 million for the pusher upgrade;
- $5.8 million for the grain terminal; and
- $3.3 million for the crane re-financing.
IFC’s proposed investment consists of:
- an A Loan of $2.6 million equivalent in Euros to TTS S.A. to fund the construction of the grain terminal and refinance the crane; and
- an A Loan of $15.6 million equivalent in Euros to Navrom to finance the pusher upgrade. |
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| Location of project and description of site |
| The crane and grain handling terminal will both be located at TTS’ facilities at the Constanta port, located on the Black Sea, which is Romania’s largest port. The pushers will be used on the Danube River, both within Romania and in neighboring European countries. TTS is headquartered in the capital, Bucharest. |
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| Project Development Impact and IFC's Role |
The project will have important benefits for the country’s transport infrastructure. It will help increase and improve cargo handling capacity and efficiency at Constanta, the largest port in the Black Sea. The project will also help the Group meet EU environmental standards and at the same time lower river fleet operation costs. This adoption of best practice environment, health and safety codes will also be important for the country’s preparation for EU accession. Lastly, IFC’s funding will help the Group modernize the Romanian shipping fleet and make this local company more competitive in the broader European shipping market.
IFC’s three fold role in the project includes:
- funding a Romanian-owned and operated transportation and logistics company to modernize its fleet and compete efficiently;
- providing long-term funding in a financial environment that can only provide terms loans of up to five years; and
- aiding the Group in updating its financial reporting systems to international standards and preparing consolidated IFRS financials at the Group level for the first time. |
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| Environmental and social issues - Category B |
This is a category B project. In conducting the due diligence, the following potential environmental and health and safety impacts were analyzed:
- environmental, health and safety management systems;
- vessel safety and pollution control;
- oil / hazardous cargo spill prevention and control;
- maintenance / repair yard pollution control and hazardous materials and waste management; and - employee health and safety.
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 locations:
- Navrom Galati headquarters, 34 Portului Str., Galati, Galati county
- MAST office in Constanta, 1, Ion Creanga, Agigea, Constanta county
- TTS Bucuresti office, 34 Str. Vaselor, Sect. 2 Bucharest |
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| To contact the project company, please write to: |
Antonio Stoean
34 Vaselor Street, 021254,
Bucharest, ROMANIA
+40-21-210-3543 (fax) |
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