LONDON (Oct. 12)—Nokian Tyres P.L.C. has negotiated a nine-year, $62 million loan with the European Bank for Reconstruction and Development and a syndicate of international banks to help it finance the construction of its plant near St. Petersburg, Russia.
Nokian earlier had disclosed a budget of $63.5 million for the factory in Vsevolozhsk, Russia, which it expects will be producing tires by next year. The 226,000-sq.-ft. facility should produce 1.5 million passenger tires in its first full year of production and grow steadily to 4 million units annually. Capacity will be expanded gradually, reaching 8 million units by 2016, Nokian said.
The plant will make Nokian-brand passenger car tires, which will be sold primarily in the growing Russian market. In the initial phase, the facility will employ about 200.
Four commercial banks are participating in the syndicate, taking $7.75 million each under an EBRD A/B-loan structure where EBRD remains the lender of record. The banks are Danske Bank A/S and HSH Nordbank A.G. of Denmark, Raiffeisen Zentralbank Osterreich A.G. of Austria and France's Credit Agricole Group's Calyon Bank's Helsinki branch.