• BBVA is leading a syndicate of banks that will lend EPSSN (the  Venezuelan national steel company) €480m to finance machinery purchase
  • EPSSN is located at Ciudad Piar, which is the top area in Venezuela for intermediate industries

On December 30th 2011 BBVA in conjunction with its Venezuelan subsidiary (BBVA Provincial) and the Ministry of Popular Power for Planning and Finance of the Venezuelan Bolivarian Republic, concluded the first phase of finance for the purchase of machinery for the Venezuelan national steel company (EPSSN). This equipment will be manufactured by SMS Siemag AG (Germany). Construtura Andrade Gutierrez SA, a Brazilian company, was awarded the EPC contract. SMS Siemag AG is the nominated supplier that will also handle installation.


The total investment for this important project, entailing steel production and rolling mills, is put at €3.0 billion ($4 billion). Of this amount €480m (some $625m) will be provided by a syndicate of banks led by BBVA. The amount is insured through the German export credit guarantee agency (Euler Hermes Kreditversicherungs-AG). A Venezuelan national development bank (Banco Nacional de Desenvolvimento Economico e Social) is also participating in the project.

Funding for the German equipment is split into two phases. The first phase, which was signed recently, comes to €283m ($373m) and the second of about €200m ($264m) will be signed in 2012.  

This project will help to boost the Venezuelan economy, generating 8,000 jobs directly and 20,000 indirectly during the construction phase. When the plant is in operation it is expected to provide 2,200 direct and 6,500 indirect jobs.

EPSSN is located at Ciudad Piar (State of Bolivar). This is the top area in Venezuela for such industries. The project's main purpose is to cover domestic demand for steel products, thus contributing to the country's economic and social development. The overall aim is to promote companies that produce intermediate manufactured goods to the point where they cover domestic demand. Subsequently these will used to boost plans for associated sectors such as oil, rail, housing and vehicle production.

This operation confirms BBVA's commitment to Latin America and the Venezuelan people. Furthermore it opens up the possibility of funding other operations with export credit guarantees in this important market.
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