Early Warning System

Countries

Serbia

Geographic location where the impacts of the investment may be experienced.

Financial Institutions

European Bank for Reconstruction and Development (EBRD)

International, regional and national development finance institutions. Many of these banks have a public interest mission, such as poverty reduction.

Project Status

Approved

Stage of the project cycle. Stages vary by development bank and can include: pending, approval, implementation, and closed or completed.

Bank Risk Rating

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

Dec 19, 2023

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

Vega IT doo Novi Sad

A public entity (government or state-owned) provided with funds or financial support to manage and/or implement a project.

Sectors

Communications

The service or industry focus of the investment. A project can have several sectors.

Investment Type(s)

Loan

The categories of the bank investment: loan, grant, guarantee, technical assistance, advisory services, equity and fund.

Investment Amount (USD)

$ 7.68 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.
Currency conversion note:
Bank reported 0,7
Converted using 2023-12-19 exchange rate.

Project Cost (USD)

$ 3.40 million

Bank Documents

Primary Source

Original disclosure @ EBRD website

Updated in EWS Mar 9, 2024

Disclosed by Bank Dec 29, 2023

Contribute Information
Can you contribute information about this project?
Contact the EWS Team

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.

Vega IT doo Novi Sad requires EUR 3.1m (senior debt) for expansion, primarily through opening of business development offices, hiring of sales staff, and for the related hiring of additional engineers to meet the expected revenue growth.

PROJECT OBJECTIVES

The Company believes that opening of the sales offices will add value to the whole business model and support growth. Additionally, bringing very experienced sales/business development staff on board, with proven track record, is also a 'push' for the whole sales stream in the Company to develop stronger sales capacity, gain knowledge and a global perspective. The Company's goal of 'going global' is the main milestone for expanding further and to maintain sustainability of business.

TRANSITION IMPACT

ETI score: 60

The transition impact stems from the following two transition qualities:

Competitive: The Project supports the expansion of Vega's sales capacities in markets where Vega does not currently operate to a material extent. The expansion will lead to significant competitiveness improvements, such as revenue growth, margin increase and access to high value projects. This will enable the company's operational performance to go beyond prevailing standards in the country/region.

Integrated: The project will support opening of business development offices abroad and expansion in new markets. As a result of the Project, opening of business development offices will result in growth of exports in new markets.

CLIENT INFORMATION

VEGA IT DOO NOVI SAD

Vega IT doo Novi Sad , based in Novi Sad, Serbia, is a regional tech company focusing on software development services. The Company was founded more than 15 years ago. During this period, it managed to deliver more than 1,500 project across Europe, the UK and USA in various sectors, including fintech, pharmaceuticals, healthtech, transportation & logistics and food & retail. Currently, Vega has more than 200 clients with no significant concentration and employs over 750 software engineers

EBRD FINANCE SUMMARY

EUR 700,000.00

TOTAL PROJECT COST

EUR 3,100,000.00

ADDITIONALITY

EBRD's additionality stems from providing funding under a tailor-made structure, availability of which is limited in the current market environment.

ENVIRONMENTAL AND SOCIAL SUMMARY

Categorized B (ESP 2019). The environmental and social due diligence (ESDD) was carried out by ESD based on the Bank's Corporate ESDD Questionnaire and supporting desk search. Environmental and social (ES) issues associated with the Bank's lending to the IT technology company, specialized in software development and digital consulting, are readily identified and will be managed by the existing management system in place, developed under the international standard for information security management systems, and the implementation of an Environmental and Social Action Plan (ESAP).

TECHNICAL COOPERATION AND GRANT FINANCING

The Company has requested that the Bank seek to mobilise technical cooperation funds administered by the EBRD and ENEF II (the "TC Funds") for the payment of outside legal counsel expenses to be incurred in connection with the preparation of the financing documentation and any other documents relating to the financing documentation, in the amount of up to EUR 60,000. The Company will be obligated to reimburse 10% of the outside local legal counsel expenses within 30 days of receipt of the EBRD's notice requesting such payment.

COMPANY CONTACT INFORMATION

Ivana Kappenmannivana.kappenmann@vegait.rs+381 (0)66 86 59 012https://www.vegaitglobal.com/Novosadskog sajma 2, Novi Sad 21000

Early Warning System Project Analysis

For a project with severe or irreversible impacts to local community and natural resources, the Early Warning System Team may conduct a thorough analysis regarding its potential impacts to human and environmental rights.

Categorized B (ESP 2019). The environmental and social due diligence (ESDD) was carried out by ESD based on the Bank's Corporate ESDD Questionnaire and supporting desk search. Environmental and social (ES) issues associated with the Bank's lending to the IT technology company, specialized in software development and digital consulting, are readily identified and will be managed by the existing management system in place, developed under the international standard for information security management systems, and the implementation of an Environmental and Social Action Plan (ESAP).

Investment Description

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

European Bank for Reconstruction and Development (EBRD)

Private Actors Description

A Private Actor is a non-governmental body or entity that is the borrower or client of a development project, which can include corporations, private equity and banks. This describes the private actors and their roles in relation to the project, when private actor information is disclosed or has been further researched.

Private Actor 1	Private Actor 1 Role	Private Actor 1 Sector	Relation	Private Actor 2	Private Actor 2 Role	Private Actor 2 Sector
-	-	-	-	Vega IT doo Novi Sad	Client	-

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.

ACCESS TO INFORMATION

You can request information by emailing: accessinfo@ebrd.com or by using this electronic form: https://www.ebrd.com/eform/information-request

ACCOUNTABILITY MECHANISM OF EBRD

The Project Complaint Mechanism (PCM) is the independent complaint mechanism and fact-finding body for people who have been or are likely to be adversely affected by an European Bank for Reconstruction and Development (EBRD)-financed project. If you submit a complaint to the PCM, it may assess compliance with EBRD's own policies and procedures to prevent harm to the environment or communities or it may assist you in resolving the problem that led to the complaint through a dialogue with those implementing the project. Additionally, the PCM has the authority to recommend a project be suspended in the event that harm is imminent.

You can contact the PCM at: pcm@ebrd.com or you can submit a complaint online using an online form at: http://www.ebrd.com/eform/pcm/complaint_form?language=en

You can learn more about the PCM and how to file a complaint at: http://www.ebrd.com/work-with-us/project-finance/project-complaint-mechanism.html