Thus, Banca Transilvania will lend EUR20 million to Profi and the EBRD will guarantee up to EUR10 million of this amount.
The guarantee allows Banca Transilvania to expand the supply chain finance program of Profi by EUR20 million, with EBRD taking up 50% of the risk, the press statement reads.
This marks the EBRD’s first supply chain finance transaction in Romania that supports a domestic value chain.
“The EBRD’s top-up is expected to enable more suppliers to access affordable working capital solutions, fostering growth and financial stability across Profi’s supply chain. Profi has up to 1800 suppliers nationwide, and more of them will be brought into the program. The project aligns with the EBRD’s Country Strategy for Romania, which aims to enhance SME development and strengthen local supply chains,” the EBRD said.
Participating suppliers will also receive support from EBRD on developing green transition plans and publishing Science Based Targets initiative (SBTi) commitments, the European lender said. Suppliers who adopt and publish SBTi commitments will then be eligible for up to 25,000 euro each of cash incentives from the European Union’s funding program for research and innovation, Horizon Europe.
Profi is the largest supermarket chain in Romania, operating 1,750 stores. Earlier this month, Belgian-Dutch grocery retailer Ahold Delhaize, which owns Romania’s Mega Image supermarket chain, said the Romanian competition authority has accepted its bid to acquire Profi from private equity firm MidEuropa under several conditions aimed to protect competition, consumer choice, and supplier interests.