EBRD provides Azerbaijani company with loan to expand greenhouse

The European Bank for Reconstruction and Development (EBRD) has approved the provision of a $2 million senior secured loan in AZN equivalent to H and M Agro LLC to support the expansion of a hydroponic greenhouse in Salyan city of Azerbaijan from the current 5 hectares to 10 hectares, Report informs referring to the EBRD website.

The total project cost is $3.98 million.

The Project will support the installation of new hydroponic greenhouses that will result in higher production yield and reduced water consumption compared to conventional greenhouses.

“Loan tenor and grace period that are not available in the country. Local banks rarely provide long-term loans to SMEs and offer no or very limited grace period (up to three months). In the majority of cases local bank loans have a tenor of 1 year which are rolled-over at maturity. Having a longer tenor loan with a grace period will allow the Borrower to better match the cash flows from the investment with debt service payments,” the EBRD noted.

H and M Agro LLC will install a new hydroponic greenhouse to produce vegetables and, as a result, is expected to benefit from an incentive grant of up to 13% of eligible costs to be financed under the FINTECC EU4Climate window.

H and M Agro LLC is a company in Azerbaijan operating a modern greenhouse for growing tomatoes, cucumbers and peppers. The Company is fully owned by Azerbaijani businessman, Kanan Rasulov.