OOO Ken-Pak Zavod Upakovki
On July 29, 2014, MIGA issued guarantees totaling $61.8 million covering an equity investment in, and two shareholder loans by Tapon France S.A.S. of France to, OOO Ken-Pak Zavod Upakovki (KPZU) in the Russian Federation. KPZU is a Russian wholly-owned subsidiary of Tapon France S.A.S. The coverage is for a period of up to 11 years against the risks of transfer restriction, expropriation, and war and civil disturbance.
MIGA’s new coverage represents continued support to the project, which began in 2009 and consisted of guarantees issued for the construction of an aluminum beverage can facility in Volokolamsk.
The project will expand to include a second factory in Novocherkassk, in the Rostov region. The new investment will support the installation, assembly, and startup of the beverage can production line and conversion of existing buildings to provide sufficient space for production and warehousing. The second plant is expected to double production capacity from the current 950 million to 1,900 million cans per year.
The project’s expansion will build on the success of the company’s first plant in Russia. The Volokolamsk plant has introduced competition in an otherwise monopolistic market, resulting in lowered can prices, product innovations, and enhanced service.
The company’s adherence to sound environmental and social practices as well as its transfer of state-of-the-art technology and management systems have added significant value—and had a demonstration effect inside the country.
The expansion will create additional local jobs, demand for servicing of advanced technologies employed in KPZU’s production process, as well as local sourcing of other services and goods.
The project is aligned with the World Bank Group’s Country Partnership Strategy for the Russian Federation, which calls for promoting economic diversification for sustainable growth, facilitating investment in non-traditional sectors, supporting technological modernization in the manufacturing sector.