30975 - ECT

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Summary of Proposed Investment

Project Number

30975

Company Name

EASTCOMTRANS LLP

Date SPI Disclosed

Mar 13, 2012

Country

Kazakhstan

Industry

Infrastructure

Projected Board Date

Apr 13, 2012

Status

Completed

Sector

Rail Transportation

Department

Regional Industry INF MCT

Environmental Category

B - Limited

Previous Events

Approved : Dec 4, 2012
Signed : Dec 28, 2012
Invested : Jun 28, 2013

Project Description

The Project would invest in Eastcomtrans LLP (“ECT” or the “Company”), the largest private railcar leasing company in Kazakhstan with a fleet of about 8,350 wagons. It provides railcars to major Kazakh and Russian companies on an operating lease basis (where the economic value of ownership remains with ECT). The Company also provides transshipment and rail forwarding services. A significant portion of its fleet are oil tank cars with the balance being open gondola wagons and Liquid Petroleum Gas (“LPG”) railcars. IFC’s investment would be part of a larger financing to fund the Company’s 2012 expansion program (the “Project”). This would enable the Company to diversify its fleet and client base while also allowing it to continue to grow its proprietary freight forwarding business.

Sponsor / Cost / Location

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	30.0
Equity	20.0

Development Impact

The project would: (i) support the continued development of a key player in the still nascent private Kazakh rail sector; (ii) promote competition and the role of the private sector in a state-dominated industry; (iii) contribute to the development of the transportation and logistics sectors in Kazakhstan; and (iv) help renew Kazakhstan''s aged railcar fleet, helping avoid a supply crisis over the next 5-10 years as about half of the existing fleet needs to be retired. The availability of new, more reliable railcars would also help sustain the competitiveness of Kazakhstan''s railway sector, mitigating the risk of trucks displacing the railway with attendant increases in harmful greenhouse gases.

In supporting ECT''s expansion, IFC would be directly aiding the continued development of one of the most competitive players in the sector. It would help ECT continue its growth aand assist it in diversifying its fleet helping make the business more sustainable and achieve the critical mass it needs to become a key long-term participant in the industry. IFC''s involvement would signal confidence in the sector''s prospects and would provide significant comfort to other potential financiers (particularly given our historical role in the Russian railcar sector), adding significant momentum to the Company''s goal of becoming a listed public company. The Corporation''s involvement would also contribute to ensuring that the Company develops in-line with international best practice and appropriate corporate governance and environmental and social considerations.

This is a category B project because the Company’s railcar lease and rental activities do not involve actual operations or maintenance of the wagons, which are designed and maintained according to local and international standards as appropriate for their operational usage, and therefore the company''s activities will not result in any material environmental and social risks and impacts.

Contacts

For Inquiries About the Project, Contact

Mr. Adilzhan Kozhabergenov
CFO, Eastcomtrans LLP
5, Al-farabi Ave
Business Center <Nurly Tau>
2A Building, office 902
Almaty
Kazakhstan

Tel: +7 (727) 277 78 78
Fax: +7 (727) 277 78 79

For Inquiries and Comments About IFC, Contact

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Telephone: 202-473-3800
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Local Access of Project Documentation

Mr. Adilzhan Kozhabergenov
CFO, Eastcomtrans LLP
5, Al-farabi Ave
Business Center <Nurly Tau>
2A Building, office 902
Almaty
Kazakhstan

Tel: +7 (727) 277 78 78
Fax: +7 (727) 277 78 79

This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors' consideration of the proposed transaction. It is not an offer of shares to the public and is intended solely to enhance the transparency of IFC’s activities. This document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. The following SPI is disclosed in accordance with IFC’s Policy on Disclosure of Information that went into effect April 30, 2006.

The map is for illustrative purposes and does not imply the expression of any opinion on the part of the World Bank, concerning the legal status of any country or territory or concerning the delimitation of frontiers or boundaries. Country borders or names do not necessarily reflect the World Bank Group's official position. In some cases, available project location information is limited to the country of the project's activities. Locations are approximate.

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