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KUKE covers BGK-financed Indonesian contract of Rafako

22-02-2018

Bank Gospodarstwa Krajowego signed a EUR 80.8 million credit facility agreement with Indonesian PT Perusahaan Listrik Negara (Persero) to finance an investment where Rafako will be the contractor. The loan is secured by KUKE’s insurance policy. The contract covers the construction of two steam blocks (2x50 MW) on the island of Lombok, in Indonesia.

Rafako’s contribution to the PLN 850 million investment is 35 percent. The contract between Rafako and the Indonesian contracting entity was underpinned by the financing package developed jointly by BGK and KUKE. KUKE also issued a performance bond counter guarantee for Rafako.

Project execution has been set to 36 months for block I and 39 months for block II.

BGK’s and KUKE’s efficient and expeditious handling of the project has made our first large contract in Indonesia a fact. A factor of considerable significance was undoubtedly a PFR-Group entity becoming our second biggest shareholder since the latest share issue. The financing agreement for this investment has made the project completely safe for Rafako in terms of its financial risks. “We have high hopes for our collaboration with Indonesia because this country is currently in the phase of implementing the assumptions of the plan to build new capacity of 35,000 MW in total. We mainly want to build smaller power blocks on individual islands there, with capacities ranging from 50-100 MW. We are currently getting ready to submit our offers in three subsequent tender proceedings, Agnieszka Wasilewska-Semail, CEO and General Director at Rafako, explained.

The financing of a foreign company was provided by Bank Gospodarstwa Krajowego within the Financial Support for Export government programme implemented in collaboration with KUKE, which provides insurance cover of export credit. So far, this is the largest credit granted by BGK directly to a foreign company under the export support programme and the first in the Republic of Indonesia.

BGK, in line with the  Sustainable Development Strategy, is actively promoting the international expansion of Polish companies. Investors and exporters selling goods and services to 55 counties on 6 continents are benefitting from our support. Polish businesses need the financial back-up to successfully compete in international markets. A fine example of the successful cooperation between the bank and businesses is the contract signed by Rafako in Indonesia, an element of which was the financing package prepared by BGK and KUKE, said Wojciech Hann, Member of the Management Board of BGK.

KUKE secured the loan through an insurance policy.

We’re glad that the many months of hard work and effort put in by Rafako, KUKE, and BGK have paid off. The close cooperation among all the stakeholders from the very beginning of the project has led to Rafako being able to offer - in a very far-away place - not only a high quality solution but also a financing package constituting an integral part of the offer. KUKE provided the insurance cover for the financing granted by BGK to the importer and issued a counter guarantee for the performance of the contract concluded by Rafako, Janusz Władyczak, President of KUKE, asserted.