The project sponsor is Rise, a conglomerate established in 1992. Rise, through five major subsidiaries, operates five main lines of business:

- distribution of imported and local seeds, crop protection products and fertilizers (Rise-Agroservice);
- import and distribution of agricultural machinery and spare parts (Rise-Agretchnika);
- sales of own and clients’ agricultural crop (Rise-Agrotrade);
- agricultural crop farming and farming technology services (Rise-Agro); and
- custom warehouse and transportation services (Rise-Transservice).

The company is owned by Vitaliy Tsehminstrenko (83.11%), Yaroslav Krasnopolskiy (13.72%) and minority shareholders accounting for 3.17%.

The total project cost is estimated at $10 million. The proposed investment includes an A Loan of up to $10 million for IFC’s own account.

10.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	10.0
Equity

* These investment figures are indicative

The company operates 49 branches/distribution centers for crop protection products, fertilizers, machinery and spare parts located in various regions of the country and headquarters in Kiev.

The project is to strengthen the financial viability of the company as it continues to develop its distribution infrastructure to better serve Ukrainian farmers. Capital investments made by the company in the past two years have been financed with medium-term (2-3 years) loans given the constraints of the Ukrainian financial markets. IFC’s assistance in refinancing $10 million of existing short- and medium-term debt maturing in 2006 with longer debt maturities will provide a sounder financial structure, in line with the expected payback of Rise’s capital investments, estimated at 4-5 years.

IFC’s role in this project will be to provide long-term financing, still unavailable in the market and to inject liquidity in a local company, which provides valuable service to the Ukrainian farming community.

Through project appraisal, IFC has played a role in assisting the company in revising its business plan and management practice, resulting in the company-wide revision of its strategic development plan, cancellation of several risky investments in the non-core business areas and strengthening of its management team through incentive-based packages to key members of the management team.

IFC’s participation in the financing of Rise will increase transparency, as the company agreed to produce annual audits of its financial statements in accordance with IFRS.

This is a Category B project according to IFC’s Procedure for Environmental and Social Review of Projects because a limited number of specific environmental and social impacts may result can be avoided or mitigated by adhering to generally recognized performance standards, guidelines or design criteria. The review of this project consisted of appraising technical and environmental/social information submitted by the project sponsor. The following potential environment, health and safety, and social impacts of the project were analyzed.

- Liquid wastes management and air emissions;
- Hazardous material management;
- Solid/hazardous waste management;
- Occupational health and safety;
- Environmental, health, and safety (EHS) management system;
- Fire prevention and emergency response;
- Rail terminals;
- Pesticide and integrated pest management; and
- Community relationship and community development.

The sponsor has presented an action plan to address these impacts to ensure that the proposed project will upon implementation of the specific agreed measures, comply with the environmental and social requirements of the host country laws and regulations and the World Bank/IFC environment and social policies and the environmental, health and safety guidelines.
Location of environmental documents In locally affected community
The ERS will be available at the following location:

National University
"Kievo-Mohila Academy"
St. Skovorody, 2,
04070, Kiev
Ukraine