EBRD announces to finance electrical companies operating in Turkey

The European Bank for Reconstruction and Development (EBRD) is extending $ 134.75m loan to three Turkish electricity companies, as part of its moves to enhance reforms in the country’s electricity sector.

The bank will offer the loan to the Trakya Electricity Distribution Company (TREDAS), the Trakya Electricity Retail Company (TREPAS), and to their parent company, IC Içtas Elektrik (ICEL).

The funding will allow the three companies to optimise their financing structure and implement capital investment plans for 2016-20.

It will enable the companies to expand and upgrade the network, enhance metering systems, implement environmental, health and safety improvements and increase network efficiency.

EBRD Power and Energy Director said: “We are pleased to further encourage the ongoing liberalisation process in Turkey’s electricity sector. This project is a great example of how the EBRD can support the modernisation of power networks following their privatisation.

“Our financing, alongside the loans from four local banks, will help our client implement the necessary measures to remain one of the most efficient electricity companies in Turkey.”

To help the companies manage foreign exchange risk, $82.25 of the total loan amount will be converted to Turkish lira at the time of each disbursement.

The funding is part of a $700m dual-currency financing package, which also includes parallel loans from Garanti Bank, Isbank, Vakifbank and TSKB.

Diversified Turkish conglomerate Ibrahim Çeçen Yatirim Holding, through its energy-sector investment arm ICEL, acquired state-owned TREDAS in 2011.

Since 2013, the country has been privatizing all power distribution firms and the ongoing reform process is due for completion by 2020.

 Ibrahim Çeçen (IC) Yatirim Holding board chairman Serhat Çeçen said: “This loan will serve to upgrade our network and further improve efficiency and reliability. I am confident that this transaction will also pave the way for a broader strategic partnership between IC Holding and the EBRD.”