EBRD backs Kazak recovery

Published: June 4, 2010

Bank joins sovereign wealth fund to help struggling businesses.

The European Bank for Reconstruction and Development (EBRD) has confirmed its support for struggling businesses in Kazakhstan by providing tens of millions of dollars to a rescue fund.

The bank has joined the country’s sovereign wealth fund, Samruk-Kazyna, in committing US$121.5mn to the ADM Kazakhstan Capital Restructuring Fund (KCRF).

The fund will be managed by ADM Capital and will help struggling Kazakh companies through restructuring, rescheduling, refinancing, debt-equity swaps or equity investments. It will also finance new opportunities where capital is unavailable.

KCRF has secured a first close of US$100mn, to which the EBRD and Samruk-Kazyna each committed US$49.5mn with ADM Capital covering the balance.

It is intended that the fund achieves a second and final closing of up to US$225mn, with the existing shareholders returning to invest alongside third parties.

EBRD president Thomas Mirow says this project is part of the bank’s “crisis response” and will “help viable businesses in Kazakhstan overcome the challenges brought by the crisis and kick-start recovery”.