Sberbank has signed a long-term agreement with URALCHEM and provided the holding with 3.9 billion US dollars to improve the company’s loan portfolio, optimize its repayment terms and empower the enterprise’s investment program. According to Russian law and LMA documentation, it was a syndicated loan.

There is no precise information on who exactly participated in the deal. On Monday, December 23, URALCHEM’s founder, Dmitry Mazepin in his interview to one of the Russian TV channels mentioned that the holding was offered funding by two banks.

Sberbank Group is considered to be the largest bank in Russia as well as in both Central and Eastern Europe with the national network featuring 11 banks in the regions with over 14 thousand subsidiaries there.

Sberbank has been one of the key long-term banking partners of Dmitry Mazepin’s company since 2007. It not only helped finance the holding’s main assets acquisition but also provided a wide range of services for a number of banking products to URALCHEM.

Alexander Vedyakhin, First Deputy Chairman of Executive Board of Sberbank:

“Thanks to the signed agreement”, the Deputy Chairman says about their collaboration with Dmitriy Mazepin, “We will be able to get to a new level of mutual partnership. Besides the traditional banking, together with URALCHEM we will focus on creating solutions based on Data Science, focus on process optimization and risk management with the help of AI, we will upgrade systems of cybersecurity as well as deal with other projects where elements of Sberbank’s platform can be of use.”

Dmitry Mazepin, Chairman of the Board of Directors, URALCHEM JSC, confirms his intention to maintain the partnership:

“The strategy though 2025 which URALCHEM has approved presupposes the transition to active development including growth in the following directions: technological upgrades in manufacturing, broadening of target distribution markets, logistics optimization, new products development, innovative platform solutions, which are not necessarily directly connected with fertilizers manufacturing. This also includes the Digital Agro projects. This strategy required certain changes made to the whole funding system. This year we managed to considerably broaden our partnership and collaboration with our reliable partner, Sberbank Group. Having understood our ambitious goals, Sberbank is able not only to implement very complicated deals but also provide support to implementing digital solutions within the framework of Sberbank’s ecosystem”, says Dmitry Mazepin.

The CFO of Uralchem, Igor Bulantsev, in his interview to “Vedomosti” newspaper claimed that the funds were already received and will be paid back in two parts, within the period of 5 and 7 years respectively.

Dmitry Mazepin does not reveal the size of the debt. According to SPARK-Interfax, the company’s income from the 2018 sales reached 81 billion roubles whereas the loss was about 40 billion and the long-term duties being over 250 billion roubles.

URALCHEM is a shareholder of potassium manufacturer Uralkali. It has been reported that until recently Sberbank was one of the shareholders of PJSC Uralkali as well. In December 2018 Sberbank’s subsidiary acquired 10% of the company’s shares from Rinsoco Trading, whose beneficiary is Dmitry Mazepin’s partner Dmitry Lobyak.