MONGOLIA MINING SERVICES PTE LTD (FMO-42435)

Countries
  • Mongolia
Geographic location where the impacts of the investment may be experienced.
Financial Institutions
  • Netherlands Development Finance Company (FMO)
International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.
Bank Risk Rating
B
Environmental and social categorization assessed by the development bank as a measure of the planned project’s environmental and social impacts. A higher risk rating may require more due diligence to limit or avoid harm to people and the environment. For example, "A" or "B" are risk categories where "A" represents the highest amount of risk. Results will include projects that specifically recorded a rating, all other projects are marked ‘U’ for "Undisclosed."
Voting Date
Jan 16, 2017
Date when project documentation and funding is reviewed by the Board for consideration and approval. Some development banks will state a "board date" or "decision date." When funding approval is obtained, the legal documents are accepted and signed, the implementation phase begins.
Borrower
Hera Equipment LLC
A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.
Sectors
  • Infrastructure
  • Mining
The service or industry focus of the investment. A project can have several sectors.
Investment Type(s)
Equity
The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.
Investment Amount (USD)
$ 0.05 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Project Cost (USD)
$ 13.00 million
Value listed on project documents at time of disclosure. If necessary, this amount is converted to USD ($) on the date of disclosure. Please review updated project documents for more information.
Primary Source

Original disclosure @ FMO website

Updated in EWS Jun 26, 2018

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Project Description
If provided by the financial institution, the Early Warning System Team writes a short summary describing the purported development objective of the project and project components. Review the complete project documentation for a detailed description.

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.

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.

Investment Description
Here you can find a list of individual development financial institutions that finance the project.

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.


Contact Information
This section aims to support the local communities and local CSO to get to know which stakeholders are involved in a project with their roles and responsibilities. If available, there may be a complaint office for the respective bank which operates independently to receive and determine violations in policy and practice. Independent Accountability Mechanisms receive and respond to complaints. Most Independent Accountability Mechanisms offer two functions for addressing complaints: dispute resolution and compliance review.

ACCOUNTABILITY MECHANISM OF FMO

Communities who believe they will be negatively affected by a project funded by the Dutch Development Bank (FMO) may be able to file a complaint with the Independent Complaints Mechanism, which is the joint independent accountability mechanism of the Dutch Development Bank (FMO) and the German Investment Corporation (KfW) . A complaint can be filed in writing, by email, post, or online. The complaint can be filed in English or any other language of the complainant. The Independent Complaints Mechanism is comprised of a three-member Independent Expert Panel and it can provide either problem-solving, compliance review or both, in either order. Additional information about this accountability mechanism, including a guide and template for filing a complaint, can be found at: https://www.fmo.nl/independent-complaints-mechanism

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How it works