Representatives of KONČAR Group today signed a €320 million project financing agreement with representatives of the European Bank for Reconstruction and Development (EBRD), the International Finance Corporation (IFC, a member of the World Bank Group), Privredna banka Zagreb and Zagrebačka banka. Together with an additional €50 million of KONČAR’s own funds, the financing arrangement provides funding for an investment project with a total value of €370 million, aimed at expanding production facilities, purchasing equipment, and strengthening manufacturing capacity for critical power equipment and infrastructure. Under the financing arrangement, EBRD and IFC will each provide €120 million, while Privredna banka Zagreb and Zagrebačka banka will contribute €40 million each. The agreed financing package represents a strong endorsement by leading international development and financial institutions, as well as Croatia’s leading banks, of KONČAR Group’s long-term growth strategy, technological expertise and international market position.

The agreement was signed at KONČAR’s headquarters by Gordan Kolak, President of the Management Board of KONČAR, and Mario Radaković, Member of the Management Board of KONČAR; Miljan Ždrale, EBRD Regional Director for Central Europe; Ines Rocha, IFC Division Director (Europe region); Paolo Musso, Advisor to the President of the Management Board of Privredna banka Zagreb; and Aleksandra Rašić, Member of the Management Board of Zagrebačka banka. Representatives of the KONČAR Group companies included in the investment cycle and financing arrangement also attended the signing ceremony.

“The confidence shown by international development institutions and Croatia’s leading banks is a strong confirmation of KONČAR’s position as an industrial and technological partner, as well as its increasingly important role in Europe’s energy transition. This support provides a solid foundation for delivering the investments that will define the next stage of KONČAR’s development”, said Gordan Kolak, President of the Management Board of KONČAR.

Mario Radaković, Member of the Management Board and CFO of KONČAR, emphasized that the trust placed in KONČAR by leading international development institutions and domestic banks confirms the Group’s commitment to the highest standards of sustainability, corporate governance, financial transparency and stability, while further strengthening the foundations for implementing the largest investment cycle in the company’s history.

Energy independence, the resilience of critical infrastructure, the strengthening of Europe’s industrial base and the establishment of secure supply chains within the European Union have become fundamental prerequisites for the long-term security and stability of Europe. In this context, strong industrial companies with proven expertise in specialized technological niches and the highest quality standards represent key strategic assets.

“We are pleased to establish cooperation with KONČAR, one of Croatia’s leading industrial companies and exporters. This investment marks the beginning of a strategic partnership and reflects EBRD’s commitment to supporting the green transition, strengthening competitiveness and modernizing electricity networks across Europe, while also investing in skills development and inclusive employment”, said Miljan Ždrale, EBRD Regional Director for Central Europe. The signing ceremony was also attended by Frederic Lucenet, EBRD Global Director, Manufacturing and Services, who welcomed the partnership and reiterated EBRD’s support for KONČAR as a regional industrial leader whose growth is closely linked to the long-term requirements of a more electrified, resilient and low-carbon economy.

The importance of increasing the manufacturing of transformers, switchgear and other critical grid equipment to alleviate supply constraints and support more reliable and efficient power systems is also recognized by IFC. “This investment strengthens Croatia’s industrial competitiveness by supporting innovation, expanding advanced manufacturing, and creating high-quality jobs. Through its partnership with KONČAR, IFC is helping strengthen the country’s industrial base and advance both long-term economic growth and Europe’s energy resilience”, said Ines Rocha, IFC Division Director (Europe region).

The investment projects financed under this arrangement are part of the largest investment cycle in KONČAR Group’s history. In response to the growing needs of the European energy sector and the strong increase in demand for power infrastructure, KONČAR plans to invest a total of €550 million over the next three years in the expansion and modernization of its manufacturing capacities, technology development, and enhancement of its technological capabilities. When combined with investments in the expansion of power transformer manufacturing capacities being implemented in cooperation with its long-standing strategic partner Siemens Energy, the total value of planned investments exceeds €800 million. Support from strong financial institutions such as the EBRD and IFC, as well as leading Croatian banks Privredna banka Zagreb and Zagrebačka banka, therefore comes at a particularly important time, as Europe requires significant investments in the renewal of transmission and distribution networks, the strengthening of industrial capacities, and the acceleration of the energy transition.

Privredna banka Zagreb, which is also acting as the agent bank for the financing arrangement, highlighted the importance of investing in the strengthening of Croatia’s industrial base and energy transition. “This significant transaction confirms our long-standing successful cooperation with KONČAR and our confidence in its growth strategy. By supporting investments of this scale, we contribute to industrial development, the energy transition and the long-term competitiveness of the Croatian economy”, said Paolo Musso, Advisor to the President of the Management Board of Privredna banka Zagreb and the Candidate for a Member of the Management Board responsible for the Corporate, SME and Small Business Division.

As a long-standing strategic partner, one of the lenders, and the global coordinator of this financing arrangement, Zagrebačka banka recognizes the importance of the KONČAR Group’s investment cycle for the development of domestic industry and the strengthening of the competitiveness of the Croatian economy. “Zagrebačka banka’s participation in this financing confirms our commitment to supporting domestic companies whose investments create new value for the Croatian economy. We are pleased to have contributed to the realization of one of the largest financial transactions in KONČAR’s history, a company we have successfully supported from day one, thereby helping to advance projects that strengthen the competitiveness, innovation, and export potential of Croatian industry”, said Aleksandra Rašić, Member of the Management Board responsible for Corporates Division, Zagrebačka banka.