ERBD signs loan for General Motors in Russia

The European Bank for Reconstruction and Development (EBRD), as lead arranger, is providing a US$150m seven-year syndicated loan to General Motors (GM).

The facility will be utilised to finance the construction of a greenfield car assembly plant currently being developed on the outskirts of St. Petersburg, a city that has become increasingly attractive to foreign automotive manufactures seeking to set up production in Russia. The country's auto market has been growing at an annual rate of 35%, becoming Europe's third largest last year.

The new factory will provide an annual capacity of 70,000 cars to supply the Russian market, and production of the Chevrolet Captiva and Opel Antara ranges is scheduled to commence this autumn.

"This new loan underlines the EBRD's strong support for GM's St. Petersburg project which will channel international best-practice techniques, know-how and other skills into the Russian automotive sector. GM has already played a pioneering role in raising the quality of locally-manufactured components and the knock-on effects of this new project will include attracting internationally qualified suppliers,” comments Alain Pilloux, EBRD business group director for Russia.

The loan will bring total EBRD commitments to the Russian automotive sector to € 1.2bn.