OREANDA-NEWS. "SEB Banka" has issued a long term loan of 14 million euro to AS "Olainfarm" to finance its capital expenditures targeted at development of product portfolio, upgrading and expanding its production capacities, increasing its export potential and entering new export markets. A commercial pledge worth 21 million euro was provided in favour of AS "SEB Banka" to secure the loan.

It is planned that proceeds are used to finance the project on " Introduction of new products and increasing of export potential of AS "Olainfarm"". Last year, to facilitate implementation of this project, the government of Latvia decided on tax rebate for AS "Olainfarm" worth 7 million euro. Upon completion of the project AS "Olainfarm" plans to introduce new products, and to significantly alter several production processes as well as to increase production efficiency. In total over the next few years AS "Olainfarm" plans to make CAPEX investments worth about 40 million euro.

"Support by the government and our long term financial partnership with "SEB Banka" gives us a possibility to solve some of the issues important for our further development, including upgrading of production unit for nitrofuranes, new production unit for small batches, increased laboratory and research capacities. Once the project is implemented, we may create up to 80 new jobs," says Valerijs Maligins, Chairman of the Board of AS "Olainfarm".

Ainārs Ozols, President of "SEB Banka": "We are grateful for an opportunity to be a financial partner of "Olainfarm", one of leaders of Baltic pharmaceutical industry - "Olainfarm" and to help them meet their development ambitions. "SEB Banka" and "Olainfarm" have had several years of successful cooperation and we are certain that company's development strategy is well developed and the company is capable of implementing large scale projects. These investments will create significant added value and will for a basis for further increase of "Olainfarm's" competitiveness."

"Olainfarm" and "SEB Banka" have implemented several sizeable cooperation projects in the past, including acquisition of chain of pharmacies in 2012, when the loan of 6 million euros was used, investments in "Olainfarm enerģija" in 2011, where the loan of 3 million euros was used, as well as credit line and other financial services provided for the development of SIA "Silvanols".