Related News

The International Finance Corporation (IFC), the private sector financing arm of the World Bank Group, is providing US$45mn in loans to two electricity distribution companies in Ukraine, AES KyivOblenergo (KOE) and AES Rivneenergo (RE).

The AES Corporation, based in Arlington, Virginia, is a majority shareholder in both companies.

KOE and RE together serve 1.2mn customers from a population base of about 3mn people. KOE supplies electricity to the areas surrounding Kiev (excluding the city of Kiev) and RE supplies electricity to the northwest region of Ukraine. IFC’s financing will help the companies reduce electricity losses, refurbish their distribution network equipment, increase the network capacity in high growth areas, and improve their overall management efficiency through investing in modern communication systems and information technology.

“IFC is committed to meeting Ukraine’s infrastructure investment needs, especially with private companies like AES Corporation that are dedicated to high standards of service,” says Francisco Tourreilles, director of IFC’s infrastructure department. “IFC’s investment will support the improvement of electricity services in Ukraine and provide an important signal for further private investment in Ukraine’s energy sector.”

“IFC is pleased to have committed its first investment in Ukraine’s power sector,” adds Edward Nassim, IFC’s director for Central and Eastern Europe. “IFC’s investment will provide the necessary long term financing that is currently unavailable in Ukraine.”

The loans are denominated in US dollars and have the longest debt tenor for a privately-owned infrastructure project in Ukraine. In addition to the loans, the IFC will provide a US$5mn Partial Credit Guarantee (PCG), which will enable the two companies to mobilise an additional US$30mn hryvnia-equivalent long-term debt. This will be the first PCG debt structuring in hryvnia.