Baltikums Bank Grants EUR 1.8M Factoring Limit to SIA Bio-Venta
January 09, 2015
Baltikums Bank and SIA Bio-Venta, the largest biodiesel production and transloading complex in the Baltics, have concluded a 1-year factoring agreement for up to 1.8 million euros.
Factoring has been in ever-increasing demand as a financial instrument for businesses to optimise their cash flows. The financing granted to SIA Bio-Venta is intended for sale of biodiesel it manufactures, particularly for increasing sales on Scandinavian markets. Biodiesel consumption in Latvia is seasonal, whereas consumption of pure biodiesel (B100) in Scandinavian countries is constant year-round. For this exact reason, Scandinavia is a strategic market for SIA Bio-Venta. Thanks to the factoring limit provided by Baltikums Bank, SIA Bio-Venta will have more funds available from November to March, when sales on the local markets are at a seasonal low.
“We are glad that our factoring and trade financing services stimulate development and overseas competition for Latvian companies,” Baltikums Bank Chairman of the Board Dmitrijs Latiševs remarks. “One of our strategic lines of business is cooperation with local producers, supporting export both westward and eastward. The SIA Bio-Venta agreement is a great example of just such a solution,” the Baltikums Bank Chairman of the Board adds.
SIA Bio-Venta is the Baltics’ largest complex for biodiesel manufacturing and transit. 70% of the rapeseed it uses for producing biodiesel is grown in Latvia, with the rest being imported. The biodiesel extraction process has byproducts such as rapeseed cake, potassium sulphate, and pharmaceutical-grade glycerine. Biodiesel is a staple resource consumed by residents and businesses on a daily basis, as an admixture to fossil diesel (in Latvia, 5% of biofuel must be added to all petroleum-based diesel fuel during the March-November period). As a result, the cooperation between Baltikums Bank and SIA Bio-Venta in this economically complicated time serves to support local farmers working in the grain cultivation sector, ensures a positive cash flow balance and boosts the state budget by way of taxation.
Public Relations Manager