Romanian chemical fertilizer producer Azomures Targu Mures signed a financing contract worth EUR 66 million which it will use to carry out one of its most significant investment projects in the last 30 years, which is the modernization of the Urea plant, according to a company statement.

The company secured the financing through a senior loan facility arranged by Česká spořitelna, one the largest banks in Czech Republic, which is a subsidiary of Austrian Erste Group. Erste’s Romanian subsidiary, BCR, also contributed to this loan as did another Czech bank, Československá obchodní banka.

The 12-year loan contract was signed on May 20, 2014, within Czech President Miloš Zeman’s business mission to Romania and Moldova.

Azomures will use the financing to modernize the Urea plant, which will be carried out by Czech company Chemoproject Nitrogen. The Azomures plant houses production lines for solid fertilizers, but also for melamine and liquid fertilizers.

Azomures aims to modernize the urea melt plant, to replace the existing granulation tower with a new, modern installation that will enable the company to comply with environmental requirements regarding dust and ammonia emissions.

Following these modernizations, not only the production capacity will increase from 900 tons per day to 1,425 tons/day, but also the plant’s flexibility towards the inquiries on the market and the domestic production flow, according to company representatives.

Azomures is controlled by Swiss agriculture producer and trader Ameropa Holding, which is owned by Andreas Zivy. Ameropa bought the control stake in Azomures from its previous Turkish owners in late 2011 for an undisclosed sum and then conducted a takeover offering on the Bucharest Stock Exchange in which it paid EUR 63 million for 24 percent of the shares, which probably means that the total transaction value exceeded EUR 260 million. After the transaction the company was delisted from the stock exchange.

Azomures is one of the most profitable companies in the Romanian chemical sector. It has revenues of over EUR 410 million and a net profit of EUR 55 million in 2005, according to public data. Results for 2013 are not public yet.

Ameropa is also present on the Romanian cereal trading market, through Ameropa Grains, which had a turnover of EUR 200 million in 2012.

Andrei Chirileasa, andrei@romania-insider.com