The European Bank for Reconstruction and Development (EBRD) provided Turkey's electricity company Enerjisa Enerji a new financing package of $125 million under the EBRD’s new Vital Infrastructure Support Program, the bank announced Tuesday.
The loan, denominated in Turkish lira to avoid currency mismatch, is provided as the first project under this emergency support program for infrastructure providers across the bank's emerging economies to ensure the provision of vital services despite acute pressure from the coronavirus pandemic, according to the statement.
"EBRD funds will support the implementation of the company's investment plans during the period of uncertainty," it said.
"This pandemic puts pressure on every part of the economy and society. As a show of support to our strong partner, we have secured sufficient liquidity to ensure Enerjisa’s operations and investment plans continue uninterrupted," said Nandita Parshad, EBRD managing director for sustainable infrastructure.
"Securing the energy supply at all times is of utmost importance, not only for the Turkish economy but also for the well-being of the population. This is particularly true in the times of COVID-19. Therefore, our top priority is to ensure the continuity of our power distribution operations and investments," said Michael Moser, Enerjisa’s chief financial officer.
Enerjisa Enerji is a joint venture between Sabancı Holding and German E.ON, with each holding a 40% share while the remaining 20% stake consists of shares floated on Turkey's stock exchange, Borsa Istanbul.
The new funds follow a $100 million loan extended by the EBRD to Enerjisa last December. The loan is linked to the new Turkish Lira Overnight Reference Rate (TLREF) benchmark, which is expected to become the reference rate for corporate lending in Turkey.
In the wake of the coronavirus pandemic, the EBRD has launched a support program for infrastructure providers. It is part of the bank’s overall Solidarity Package which also includes short-term liquidity, working capital and restructuring of exposure for existing clients, as well as trade finance. The EBRD stands ready to provide support worth 21 billion euros (TL 159.4 billion) over the 2020-21 period across 38 countries.