The project sponsor is the Huta family (the “Sponsors”), who founded Mriya in 1992 and control it till this day. The head of the Huta family, Ivan Huta, a well-respected Ukrainian businessman, and his wife, Klaudia Huta, Ivan and Klaudia Huta established Mriya on 50 hectares of land, after having worked for eight years at a state farm. In 2002, Andriy and Mykola Huta, the sons of the founders, joined the family business after completing their education in Ukraine and abroad. Following a private placement on the Entry Standard of the Frankfurt Stock Exchange in 2008, the Sponsors collectively own 80% of Mriya’s Cyprus-based holding company that fully controls all of Mriya’s Ukraine-based operating companies, with the remaining 20% owned by over 20 institutional investors.

The total project cost is estimated at $213.7 million. Mriya will use proceeds from the loans to produce wheat, corn, barley, sugar beets, rapeseed and other agricultural commodities for sale to local clients and international traders. Higher working capital will allow Mriya to increase its production volumes 2-3 fold and increase land area under cultivation to 315,000 ha by 2012. IFC investment will consist of a one-year loan facility (the “Working Capital Facility”) of up to $25 million renewable twice at the end of a 365 day period for one year each time, a long-term C-Loan of up to $25 million, and warrants of up to $25 million.

75.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	50.0
Equity	25.0

* These investment figures are indicative

The project will allow Mriya to expand its farming operations and grain storage infrastructure in the Ternopil, Ivano-Frankivsk, Chernivtsi and Khmelnitsky regions, which are among the poorest, primarily agricultural, regions of Ukraine.

Employment: Mriya has approximately 606 permanent employees and 310 seasonal employees. The project is expected to increase permanent employment to about 800 and seasonal employment to about 500. In the western Ukraine where Mriya operates, employment opportunities are scarce. In addition to creating new jobs, Mriya is setting new employment standards in the region by providing benefits to its farm workers such food and housing. Environmental and Social Standards: As part of the Environmental and Social Action Plan (ESAP), Mriya will implement an ESMS to provide a structured framework to identify and act on environmental and social risks and opportunities in the management of its agricultural operations as well as down-stream in the agricultural value chain, in the operations of the Sponsor-owned affiliated sugar beet processing plants. Private Sector Development: Mriya sells its products to a well diversified base of final customers and traders. Among them, there currently are about 88 MSME distributors of mainly potatoes, buckwheat, and corn, for final sales on the domestic market. On the purchasing side, Mriya relies on about 22 MSME suppliers, in addition to several large key ones, for deliveries of fertilizers, plant protection chemicals, and spare parts.

Provision of liquidity: IFC will play an important counter-cyclical role by providing working capital to a major Ukrainian agricultural crop producer in an economic context where such funding is scarce and difficult to obtain. Flexible long-term financing: IFC is uniquely able to (i) offer long-term quasi-equity financing without taking over control, (ii) offer flexibility of the financial package by including loner debt tenors with the ability to provide more funding at later stages, and (iii) establish a long-term partnership with the Company to support its future development, the approach other financiers typically do not take. Demonstration effect: By partnering with the IFC, the client will be able to enhance its risk profile and improve its chances to secure additional financing from other banks. IFC’s involvement in the project will also send a positive message and reassure other lenders and investors that there are attractive opportunities in Ukraine’s market, even during a time of severe crisis.