Eco Baltia is preparing for inaugural bond issue

Eco Baltia, the largest environmental and waste management group in the Baltics, backed by INVL Baltic Sea Growth Fund, leading Baltic private equity fund, plans to execute its first unsecured bond issue in the nearest future. The proceeds from the bond issue will be used for the group’s development projects with the aim of further strengthening its contribution towards promotion of circular economy at the international level.

“Attracting financing in the capital market is a successive step in the further development of Eco Baltia. During the last two years we have restructured our business model, reorganized corporate governance structure, confidently moved towards CO2 neutrality in business and implemented large-scale investment projects that strengthened competitiveness and positions in international markets. Our business operations, goals and ambitions for growth extend well beyond the level of Latvia and even the Baltics. That’s why we are prepared to take the next step and attract financing in the capital market, confirming our development prospects and profitability,” emphasizes Māris Simanovičs, chairman of the board at Eco Baltia.

According to Vytautas Plunksnis, Partner at INVL Baltic Sea Growth Fund and Chairman of the Supervisory Board of Eco Baltia, the funds raised from investors would be used for acquisitions to achieve the strategic goal of developing the environmental and waste management group as a strong regional leader.

“Listing the bonds on the public market will also undoubtedly increase Eco Baltia’s visibility to investors,” says V. Plunksnis.

The issue of unsecured bonds with short to medium term maturity will be organized in one tranche and the process will be managed by Luminor Bank, one of the leading financial service providers in the Baltic States.

The issue of unsecured bonds is planned as a public offering in the near future subject to market conditions. The bonds are planned to be offered to both private and institutional investors. Bonds will be listed on “First North” alternative market of “Nasdaq Riga” after the placement.

About Eco Baltia

Eco Baltia group is the largest environmental and waste management group in the Baltics, providing the full-cycle waste management solutions from waste collection and sorting to secondary raw material logistics, wholesale and raw material processing as well as PET and PE/PP plastics recycling.

In 2022, the Eco Baltia group pro-forma revenues are expected to reach around €240mn, compared to €150mn in 2021. In September 2022, the group expanded its operations outside of the Baltics, with its PET recycling arm AS PET Baltija, one of the largest PET recyclers in Northern Europe, completing the acquisition of a leading Czech fibre producer TESIL Fibres.

The group companies employ more than 2,200 employees in Latvia, Lithuania, and Czech Republic. Its leading companies are PET Baltija, Eco Baltia vide, Latvijas Zaļais punkts, Nordic Plast, JUMIS, Czech TESIL Fibres and Lithuania-based Ecoservice. 

Shareholders of Eco Baltia are private equity fund INVL Baltic Sea Growth Fund (52.81%), the European Bank for the Reconstruction and Development (30.51%) and management of the company (16.68%). 

INVL Baltic Sea Growth Fund

With a size of EUR165 million, the INVL Baltic Sea Growth Fund is one of the largest private equity funds in the Baltics. The European Investment Fund (“EIF”) is its anchor investor.

The EIF, which is a part of the European Investment Bank, has committed EUR 30 million with the support of the European Fund for Strategic Investments (a key element of the Investment Plan for Europe, or ‘Junker Plan’) whilst also allocating resources from the Baltic Innovation Fund, a “fund of funds” initiative developed in cooperation with the governments of Lithuania, Latvia and Estonia. The initiative aims to increase capital investment in high-growth potential small and medium-sized enterprises in the Baltics.

The fund seeks to assemble a diversified portfolio of companies, targeting majority or significant minority stakes through investments ranging from of EUR 10 million to EUR 30 million. These companies must demonstrate high growth potential and an ability to succeed in conditions of increasing global competition and market volatility.

The fund is focused on the Baltic countries and neighbouring regions including Poland, the Nordics, and Central Europe. The fund has invested in seven companies to date, focusing on sectors including healthcare, medical rehabilitation, civil engineering, environmental management (plastic recycling and waste management), veterinary services, and the manufacturing of cosmetics and hygiene products.

The fund is managed by INVL, the leading Baltic investment management and life insurance group. The group’s companies manage pension and mutual funds, life insurance directions, individual portfolios, private equity as well as other alternative investments. More than 300,000 clients in Lithuania, Latvia and Estonia plus international investors have entrusted the group with the management of over EUR 1.75 billion of assets. With a track record spanning 30 years, the group has strong expertise and experience in managing private equity assets and building true market players that are leaders in their respective fields in the Baltic countries and across Central and Eastern Europe.