The European Bank for Reconstruction and Development (EBRD) is injecting up to €25mn in a Citi-led supply chain finance (SCF) programme for Finnish firm Metso Outotec.
The EBRD’s funded risk participation in the deal will help provide Metso Outotec’s Turkish suppliers with access to “affordable” working capital, the multilateral development bank says in a statement.
The deal is one of the first since the EBRD launched its supply chains solution framework, under which it participates in commercial banks’ SCF programmes being offered to suppliers in the EBRD’s coverage area.
Turkish suppliers taking part in the programme – the majority of which are SMEs – will also be rewarded for meeting emissions reductions targets through a grant from the Türkiye-EBRD Cooperation Fund. Citi is administering the programme.
Metso Outotec is a technology and services firm focused on the metals and minerals processing sector. Marius Verwoerd, the company’s vice-president for sustainability, says: “Innovative financing solutions like this will make a significant contribution to Metso Outotec’s efforts to manage emissions across its supply chain. The collaboration with Citi and the EBRD is a great example of what is possible when companies partner up to support the energy transition.”
“Supply chain finance is a proven instrument for delivering accessible liquidity to SME suppliers and improving the resilience and interconnectivity of regional and global supply chains,” says Arvid Tuerkner, EBRD’s managing director for Turkey.
“We are happy to be partnering with Citi and Metso Outotec on this project, which contributes not only to providing access to working capital finance for Metso Outotec’s Turkish suppliers, but also to supporting their green transition at scale.”
The first project under the EBRD’s supply chain solutions framework was a partnership with Santander for the supplier payment programme of Zabka, a Polish convenience store operator.