KfW IPEX-Bank provides financing for a UFK-backed silicon project in Iceland

Frankfurt am Main (ots) -

   - KfW IPEX-Bank is helping German firm PCC SE to invest in Iceland
   - Project backed by the UFK scheme secures Germany's supply of raw
   - State-of-the-art technology from SMS Siemag - an EPC turnkey 
   - First large-volume, commercial form of structured project 
     finance in Iceland 

By providing investment finance in the amount of USD 194 million, KfW IPEX-Bank is helping the German firm PCC SE to build a state-of-the-art silicon metal production plant in Husavik in the north of Iceland. The complex financing structure with a term of 15 years (incl. construction time) not only provides backing from Euler Hermes, but also incorporates an Untied Loan Guarantee (UFK). In providing this coverage, the German Federal Government is supporting raw materials projects abroad that are classed as being worthy of promotion or that are in the particular state interest of the Federal Republic of Germany. The silicon produced in the new silicon smelting plant of "PCC BakkiSilicon hf" in Iceland is distributed to various German companies from different industries on the basis of long-term supply contracts. It is therefore being used to secure the supply of raw materials in Germany. Düsseldorf-based SMS Siemag AG, one of the world's leading companies in the field of metallurgy and rolling mill technology, was awarded the contract to build the turnkey plant.

"The UFK coverage underlines just how relevant this business is to the Federal Republic of Germany. Indeed, it is exclusively German customers who are purchasing the silicon produced by PCC in Iceland, which substantially helps our industry to secure the supply of raw materials over the long term and become more independent on the developments of the spot markets. The fact that SMS Siemag is behind the highly efficient production technology and that, in providing the financing, we are therefore also supporting German investment abroad confirms both our strategy and our involvement in two respects," says Markus Scheer, member of the Management Board of KfW IPEX-Bank.

The PCC BakkiSilicon project involves the construction of a plant to produce high-purity silicon metal with a capacity of 32,000 mtpa. The total project volume amounts to the equivalent of almost USD 300 million. The main investor in the plant, considered one of the most modern silicon plants in the entire world, is the mid-sized German firm PCC SE, based in Duisburg. Since it is an alloy metal, silicon is used primarily in the aluminium industry. It is also the higher quality silicon metal products for the chemicals, electronics and solar industries which drive growth in global silicon demand.

The smelting plant primarily purchases quartzite, the basic material needed to produce silicon, from one of the PCC SE Group's own company quarry in Poland through a long-term supply agreement. Landsvirkjun, Iceland's energy supplier, is meanwhile guaranteeing to supply the energy required for the production operations on the basis of a long-term supply agreement. The state-owned enterprise supplies its customers with power sourced to 100% from renewable energy generated primarily by hydropower plants but also by geothermal plants and wind farms.

As an EPC (engineering, procurement and construction) contractor, SMS Siemag is supplying the core components of the silicon smelting plant as well as the relevant auxiliary production plants. SMS Siemag will receive support in providing the turnkey plant from M&W Group GmbH, a German plant engineering firm which has already implemented a range of projects in Iceland. The plant is being built in an as-yet undeveloped industrial estate in the north-east of Iceland and is helping to create jobs (120 directly, more indirectly) and to industrialise the north-east of Iceland. This is the first large-volume, commercial form of structured project finance of its kind in Iceland.

About PCC

PCC SE is a value-led management and investment company headquartered in Duisburg, Germany. PCC SE manages a conglomerate undertaking with around 2,900 employees located at 39 sites in 17 countries. The three main business areas of the PCC Group are Chemicals, Energy and Logistics, with the Chemicals division making up the main core of the Group. In fiscal 2013, PCC SE generated consolidated sales of 624 million euros and realised an operating profit (EBITDA) of 47.5 million euros. According to the Group´s provisional, unaudited figures, sales recorded in 2014 amounted to 648 million euros, with EBITDA coming in at 51.4 million euros. For more information: www.pcc.eu.

About KfW IPEX-Bank GmbH

Within the KfW Group, KfW IPEX-Bank is responsible for international project and export finance. Its function of providing financing to boost the German and European economy is derived from the legal mandate assigned to KfW. It offers medium- and long-term financing to support key export industries, to develop economic and social infrastructure and to fund environmental and climate protection projects. KfW IPEX-Bank operates as a legally independent group subsidiary and plays a major role in fulfilling KfW's promotional mission. It is represented in the most important economic and financial centres across the globe.


KfW IPEX-Bank GmbH, Palmengartenstraße 5-9, 60325 Frankfurt
Pressestelle: Thomas Krick, E-Mail: thomas.krick@kfw.de
Tel. 069 7431-2961, Fax: 069 7431-9409, E-Mail:
Internet: www.kfw-ipex-bank.de

Original-Content von: KfW IPEX-Bank, übermittelt durch news aktuell

Weitere Meldungen: KfW IPEX-Bank

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