Romanian Efes Brewery S.A.

completed

Summary Of Project Information (SPI)Project NameRomania - Efes Brewery ProjectRegionEuropeSectorProject No007869Projected Board DateJanuary 30, 1997Company NameRomanian Efes Brewery SATechnical Partner and/or Major Shareholders The principal sponsor and shareholder is the Efes Group, the beverage arm of the Anadolu Group, which is a large diversified industrial group in Turkey.Project Cost Including proposed IFC investment The total project cost is US$70.0 million. IFC is proposing to invest up to US$25.0 million in the project, including an “A” loan of US$12.0 million, a “B” loan of US$8.0 million, and equity of up to US$5.0 million equivalent.Location of project and Description of site The project will be located in Ploesti, the capital city of Prahova county, approximately 60 km north of Bucharest. The site is a 12 hectare plot of land on the outskirts of Ploesti. It is adjacent to a railway network with good access to all parts of Romania, as well as the main road linking Ploesti to Bucharest. Adequate water will be available from the municipal water system of Ploesti and from wells which will be drilled on the site. Description of Company and Purpose of Project The project is to construct and operate a brewery in Romania, with an initial production capacity of 750,000 hl per year. The brewery will be owned by Romanian Efes Brewery SA, a Romanian company controlled by the Efes Group. The brewery will be constructed over a two-year period, incorporating modern brewing and packaging technology. Compared with beer from the country’s existing breweries, the project’s beer will be more hygienically produced, will be of more consistent quality, and will have a longer shelf-life. A modern distribution system will also be developed, combining both direct delivery and the use of exclusive wholesalers. The economic rationale for the project is to supply good quality beer to the Romanian market at the lowest possible economic cost. Given that the cost of transporting beverages is high relative to their value, the economic cost of producing these products locally is lower than the alternative of importation. This economic saving will also lead to a reduction in retail prices of quality beer in the country, which will benefit consumers. Furthermore, the project will have a positive development impact in the country by generating employment, by increasing skill levels in the workforce, and by developing the country’s business infrastructure, including distribution, wholesale and retail networks. Overall, the project will assist the country’s transformation from a command, supply-driven economy towards one that is service-oriented and market-driven.Environmental Category and Issues This is a category B project according to IFC’s environmental review procedure; principal issues include water supply, liquid effluent treatment, air emissions, solid waste reuse and disposal, potential contamination of site from present or past uses, potential use of CFCs, fire and explosion prevention, and workplace health and safety. Steam boilers at the brewery will be operated with low sulfur fuel to minimize sulfur dioxide emissions. A new wastewater treatment facility will be installed such that liquid effluents will meet the respective Romanian standards and the World Bank guidelines. The company will clean and reuse all types of product containers. The site has not been contaminated by either present or past uses. Ammonia will be used as the refrigerant for central cooling systems. Fire protection programs will be implemented to meet local requirements and World Bank guidelines. Efes will implement workplace safety and employee protection programs at the plant. Employees will be provided with and required to use appropriate personal protective equipment. Training will be provided in workplace safety procedures, accident prevention, fire protection, emergency response and the use of personnel protective equipment.The is from the Public Information Center.Date SPI sent to PIC December 23, 1996For Additional Information contact: Corporate Relations Unit -telephone: (202) 473-7711facsimile: (202) 676-0365Environmental documents for this project are available at http://www.ifc.org and from the World Bank InfoShop (http://www.worldbank.org/html/pic/aboutinfo.html).