Project Description

A senior loan of up to USD 33.2 million (EUR 29.5 million) to be provided to Borusan Lojistik Dagitim Depolama Tasimacilik ve Ticaret AS (“Borusan Logistics” or the “Company“). Borusan Logistics is an integrated logistics service provider incorporated in Türkiye offering (i) comprehensive supply chain solutions and third party logistics services in Türkiye and worldwide (“3PL“) and (ii) port management services at Borusan Port (the “Port“) located in the Gemlik district of South Marmara region of Türkiye.

The loan proceeds will be used to finance Borusan Logistics’ capital expenditures to (i) upgrade and expand the Port’s facilities; and (ii) accelerate digitalisation development and renew the logistics fleet of the Company’s logistics business in Türkiye (the “Project“). 

Project Objectives

The Project’s objectives are to (i) upgrade and expand the Port’s facilities and (ii) improve the Company`s operational efficiency.

Transition Impact

ETI score: 64

The Project’s transition impact stems from the following key areas:

1. Competitive: The Project promotes improvements in (i) the Port’s operation costs, and (ii) the 3PL’s business efficiency as a result of digitalisation investment.
2. Integrated: The Project supports quality improvements to the Port’s facilities and capacity expansion to provide improved general and project cargo services to support increasing demand in the Port’s catchment area.

Client Information

BORUSAN LOJISTIK DAGITIM DEPOLAMA TASIMACILIK VE TICARET AS

Borusan Logistics was founded in 1973 by Borusan Holding, one of the largest conglomerates in Turkiye with operations in steel sector, distributorship of leading car and machinery brands, energy business and integrated logistics. Headquartered in Istanbul, Borusan Logistics provides 3PL, port management, chartering and heavy transportation services. 

EBRD Finance Summary

USD 33,200,000.00

Up to 33.2 million senior loan.

Total Project Cost

USD 56,700,000.00

The total project cost is estimated at USD 56.7 million.

Additionality

Additionality stems from the financing structure and risk mitigation. The EBRD provides long-term financing, which is aligned with the Project’s needs and which is not readily available on the market from local commercial banks at the required tenors. The EBRD’s long-term involvement provides comfort to the Company to allow it to take more risk, enabling the Port’s expansion amid uncertainties in the market. The Project promotes the use of electric equipment where such alternative exists. Furthermore the Project aims to strengthen the equal opportunities policies and practices in a traditionally male-dominated sector, by increasing female employment across the company’s operations. 

Environmental and Social Summary

Categorized B (ESP 2019). Investments into reconstruction and expansion of the port logistics facilities and replacement of the fleet are associated with site-specific E&S impacts that can be readily identified and addressed through Environmental and Social Action Plan (“ESAP”) and implementation of the good E&S management practices and stewardship.

The Environmental and Social Due Diligence (“ESDD”) of the Project has been performed by an independent consultant and included a site visit and audit of the current operations, review of the status of E&S compliance, planning and permitting activities, Company’s Environmental and Social Management Systems and practices, labour and working conditions, including GBVH, and E&S audit of the existing operations. It has been confirmed that Borusan Logistics and Borusan Port have established robust Quality Health, Safety, and Environmental (“HSE”) management system in line with the ISO 14001 Environmental Management System, ISO 45001 Occupational Health and Safety Management System, and ISO 9001 Quality Management System. The Company has required capacity to implement the Project in line with the Bank’s Performance Requirements (PRs).

The project will be developed within the footprint of the existing Borusan port and warehouse facilities, and no additional land take is envisaged. ESDD also included an assessment of the impacts associated with the dredging operations. It has been confirmed that the pollutants concentration in the dredging material are well below the nationally established norms for the Marmara Sea region and are in line with international standards. There may also be impacts on the livelihoods of fishermen due to dumping of the dredging material. These cannot be identified exactly as the dumping site is not decided and approved at the time of the ESDD and it will be approved in due course by the relevant authorities. The Company will be required to develop a dredging management plan as part of the Environmental and Social Management Plan (“ESMP”) and ESAP to include an impact assessment near the port area and the dredged material disposal area in the Marmara Sea, and manage activities to avoided spawning and breeding seasons. Additionally, the ESAP includes a commitment to conducting a specific fisheries impact assessment when the dumping area is approved, which will also include an assessment of the need for a livelihood restoration plan and development of one if found to be required.

Other social impacts of the Project include, intel alia: community health and safety; road safety risks for neighbouring communities and communities along the traffic route, which will be managed by community health and safety and traffic management plans making part of ESMP; labour/working conditions and local employment impacts which will be managed through ESAP actions including strengthening human resources policies and processes on freedom to organisation, collective bargaining, employee representation and grievance management including GBVH complaints. Through the ESAP, the Company also commits to increasing local employment as well as regular direct employment in compliance with local labour laws. Air, noise and vibration impacts will be managed by air, noise and vibration management plans. Finally, the ESDD included development of a stakeholder engagement plan which identified stakeholders and developed an engagement program for the Project including a grievance management mechanism. 

Technical Cooperation and Grant Financing

None. 

Company Contact Information

Aydin Basar
Aydin.BASAR@borusan.com
+90 212 473 15 15
https://www.borusanlojistik.com/en
Istiklal Mahallesi, Piyalepasa Bulvari Bul. B-C Blok No:22/1 Ic Kapi No:5 Beyoglu 34440 Istanbul / Türkiye

Implementation summary

PSD last updated

03 Aug 2023

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

For business opportunities with EBRD (not related to procurement) contact:

Tel: +44 20 7338 7168

Email: projectenquiries@ebrd.com

For state-sector projects, visit EBRD Procurement:

Tel: +44 20 7338 6794

Email: procurement@ebrd.com

General enquiries

Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD’s Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to compliance@ebrd.com. All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank’s countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email ipam@ebrd.com to get guidance and more information on IPAM and how to submit a request.