The European Bank for Reconstruction and Development (EBRD) has closed a €200mn syndicated loan in favour of Turkish automaker Tofaş, a joint venture between Italy’s Fiat Chrysler Automobiles (FCA) and Turkey’s Koç Holding.
The EBRD is providing €100mn of the long-term A/B loan, while the remaining €100mn was syndicated to HSBC and Bank of America Merrill Lynch. The financing will go towards the construction of two new models of passenger cars, which are estimated to cost a total €415mn. HSBC is also providing another loan worth €200mn and backed by Italian export credit agency Sace towards that goal. Tofaş has not responded to GTR’s request to explain the financing of the remaining €15mn for the project.
Production at the manufacturing plant was halted in May due to eight-day long workers’ protests demanding better employment conditions. According to an EBRD statement, the bank will also help Tofaș provide greater employment opportunities for young people through expanded vocational training and closer partnerships with schools. Jean-Patrick Marquet, EBRD Director for Turkey, says: “We are pleased to support Tofaș as it invests in research and development but also in human capital in order to create new value-added products and stay competitive in global markets.”
“We have a comprehensive approach to innovation. It relates to our products and services, business practices and organisational solutions. We are reshaping Tofaș’ employment policy and are accelerating our research and development work,” says Cengiz Eroldu, Tofaș’ CEO.