Project detail - MONGOLIA MINING SERVICES PTE LTD

MONGOLIA MINING SERVICES PTE LTD

Back to map

Who is our client

Mongolia Mining Services PTE Ltd. is the Special Purpose Vehicle through which FMO and the Mongolia Opportunities Fund (MOF) are invested in Hera Equipment LLC. The Company is a leading mining equipment and heavy machinery supplier and an official distributor of Hyundai Heavy Industries from Korea, Daewoo, Hanjin D&B, Junjin CSM, Rubble Master from Austria, Cummins, Colorado TR and ITR from Italy. Hera's particular focus area is in excavators, in which it leads the market, and smaller machinery produced by Hyundai.

Funding objective

The full amount of USD 13 million (USD 3 million equity and USD 10 million Mezzanine loan) will be used for a combination of working capital financing, warehouses/servicing facilities and for the engine rebuild faciliity. 50% of the mezzanine loan will be used to purchase equipment for rental and leasing purposes. This transaction is a co-investment with The Mongolia Opportunities Fund (MOF), which is being managed by Mongolia Opportunities Partners.

Why we fund this project

This co-investment provides an opportunity for FMO to participate in an attractive company with significant growth potential. Mining development has boosted the demand for heavy machinery and mining equipment. The development impact is excellent, given the provision of long-term risk-bearing capital by DFIs in challenging times and circumstances. The transaction is the first co-investment opportunity with MOF which has a perfect fit with FMO's strategy to provide direct investments alongside the PE Funds we have already invested in.

Region
Asia
Country
Mongolia
Sector
Infrastructure, Manufacturing and Services
Signing date
9/20/2013
Total FMO financing
USD 3.12 MLN
Fund
FMO
Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk Environmental & Social Category
(A, B+, B or C)
B