June 24 (SeeNews) - Romanian lender Banca Comerciala Romana (BCR) said on Thursday that it has signed an agreement with TeraPlast Group to provide a 12.7 million euro ($15.2 million) green financing package for a biodegradable foil production line.
The financing will be used for the construction and equipment of a production unit for the manufacture of biodegradable packaging, bags and sacks, BCR said in a press release.
Financing for the project includes the shareholders contribution, a bank loan in accordance with green financing principles, and state aid covering 50% of the eligible costs. The green financing package of 12.7 million euro will be divided in two tranches: 6.9 million euro for up to 7 years maturity and 5.8 million euro bridge financing for the state grant to be received.
For this investment, TeraPlast Group will create a new company, TeraBio Pack, and the plant will be operational in the third quarter of this year.
The addressed markets for this project are Romania and nearby countries.
"This project of over 12 million euro for the biodegradable foil production facility is the group's largest investment to this date in sustainable products," TeraPlast CFO Ioana Birta noted.
TeraPlast Group aims to double its recycling capacity during 2021 in order to become one of top five European recyclers of rigid PVC. The group will also continue to invest in expanding its renewable energy production, as currently 11% of the production needs are covered through photovoltaic panels. The company aims to reduce greenhouse gas emissions by 100%, to increase the share of energy from renewable sources up to 20-30%, and to continue digitizing the internal processes.
TeraPlast's shares traded 0.12% lower at 0.8360 lei ($0.2/0.17 euro) as at 1155 CET on Thursday on the Bucharest Stock Exchange.
($=0.8374 euro)