Co-ordinating mandated lead arrangers and bookrunners Société Générale and ABN Amro have closed syndication on the US$250mn portion of a dual-tranche facility being raised for Ukraine's Industrial Union of Donbass (IUD).

This tranche forms part of a US$350mn financing package raised to support the modernisation of the Ukrainian steel company's operations. The IFC has provided the remaining US$100mn A tranche.

Syndication of tranche B is said to have attracted a total of 12 banks. The facility was slightly oversubscribed, but the borrower opted to just take up the initially requested amount.

The IFC has previously provided financing to the IUD as part of its programme to support the Ukrainian steel industry. This financing package is specifically focused on modernising operations at the company’s two iron and steel plants, Alchevsk Iron and Steel and Dneprovsky Iron and Steel, both of which are over 100 years old, as well as the Alchevsk coke plant.

The multilateral’s modernisation programme for IUD aims to lower costs for the company, and significantly reduce its carbon dioxide emissions. It is also expected to improve the local economy in the towns of Alchevsk and Dneprodzerzhinsk, where the company’s plants employ around 40,000 people.

IUD was established in 1995, and is a holding company with stakes in a number of businesses in the mining and steel industry, with assets in Hungary and Poland, as well as the Ukraine.