24 May 2014
AzMeCo and Sberbank Sign Memorandum of Cooperation
AzMeCo’s Expansion Plans Backed by $ 1.5 Billion Financing Facility
At the XVIII St. Petersburg International Economic Forum, AzMeCo and Sberbank signed a Memorandum of Cooperation outlining a strategic framework and priority areas for collaboration between the two organizations.
Under the agreement, Sberbank will provide financing totaling $1.5 billion to support AzMeCo’s key projects. This includes the refinancing of the Karadagh methanol plant near Baku at a value of $450 million, long-term project financing for the development of commercial retail space in Moscow, and funding for the construction of a methanol plant in Russia.
The Memorandum of Cooperation is set for a five-year term, with the option for extension. Each individual project will be governed by separate agreements. Importantly, the memorandum does not restrict AzMeCo from engaging with other financial institutions.
The document was signed on behalf of AzMeCo by Nizami Piriyev, Chairman of the Board of Directors, and by Sergey Gorkov, Deputy Chairman of the Board of Sberbank.
Under the agreement, Sberbank will provide financing totaling $1.5 billion to support AzMeCo’s key projects. This includes the refinancing of the Karadagh methanol plant near Baku at a value of $450 million, long-term project financing for the development of commercial retail space in Moscow, and funding for the construction of a methanol plant in Russia.
The Memorandum of Cooperation is set for a five-year term, with the option for extension. Each individual project will be governed by separate agreements. Importantly, the memorandum does not restrict AzMeCo from engaging with other financial institutions.
The document was signed on behalf of AzMeCo by Nizami Piriyev, Chairman of the Board of Directors, and by Sergey Gorkov, Deputy Chairman of the Board of Sberbank.
Nasib Piriyev, CEO of the AzMeCo Group, commented:
“This deal is the first of its kind—a large-scale project financing agreement between a private Azerbaijani company and Sberbank—and I am very proud of this great achievement. We have been preparing for this transaction over the past six months, and I am pleased to see it successfully concluded. I would like to thank both the Sberbank and AzMeCo teams for their dedication and hard work in making this deal a reality. We also hope this precedent will pave the way for further cooperation between Azerbaijani private companies and leading international financial institutions.”
Sergey Gorkov, Deputy Chairman of the Board of Sberbank, added:
“Azerbaijan is the largest foreign investor in the Turkish economy, making the Azerbaijani market highly relevant to the Sberbank Group. This partnership with AzMeCo is our first engagement with a private company from Azerbaijan and represents a valuable opportunity to expand our presence in the region.”
AzMeCo is part of the PNN Group, which manages a diversified portfolio of oil, gas, and petrochemical assets, along with retail operations in Azerbaijan, Russia, Ukraine, the Netherlands, Uzbekistan, Afghanistan, and Turkey. AzMeCo owns the only methanol plant in Azerbaijan built to meet international standards, with approximately $ 500 million invested in its construction. Natural gas is supplied to AzMeCo by the State Oil Company of the Azerbaijan Republic (SOCAR).