Tube Works Re-forms Credits of Azerbaijani International Bank

Business Materials 13 February 2008 15:56 (UTC +04:00)

Azerbaijan, Baku, 13 February / Trend corr. I.Khalilova / The Azerboru joint-stock company (Sumgayit tube works) extended the credit agreement, issued to its former shareholder British Targol Investment, from the Azerbaijani International Bank to develop production, Azim Azimov, the General Director of the works, stated.

According to Azimov, additional loans from the IBA in the amount of $8.5mln were issued.

Under an agreement with the European Bank of Reconstruction & Development (EBRD), the term for re-paying the first loan was extended and Azerboru is to pay it off completely within four to five years.

Targol used the enterprise to pledge for loans in the amount of $6.9mln. Some $1mln of this sum has been paid back.

Targol Investment privatized tube works through investment competition; however, the contract was canceled at the end of 2005 due to non-fulfillment of investment obligations. Azimov noted that the works owners took the case to the Economic Court and cancelled the contract. Targol was obliged to invest $50mln in Sumgayit tubes works. However, the investor allocated only $4.3mlnwhich exceeds the loans from IBA. [Independent auditors, invited by the State Committee on State Property Management, carried out monitoring on fulfillment of investment obligations].

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