Author Archives: MPI

New Envestio project – Wood pellets – trade financing 2

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing project “Wood pellets – trade financing 2″, Envestio continues the successful cooperation with the representatives of the environmental-friendly energy industry.

The loan is fully secured by commercial pledge and personal guarantee of the main beneficiary of NDINAMIKA SIA.

You can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment in energy sector, factoring-type financing for a wood pellets trading company.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

The company NDINAMIKA SIA is a company that is successfully acting on the market of sale and delivery of wood pellets/biomass fuel to Latvian households, small agricultural complexes, and other consumers. Taking into consideration increasing prices for traditional fuel, such as natural gas and oil products, the demand for wood pellets is constantly increasing that provides good business opportunities for the market players.

Besides pricing, one more key factor that affects demand is absence of complex and pricey requirements to the heating system of the household. Burning pellets in an ordinary stove can perfectly heat a small and medium size (up to 150 m2) private house; no special gas or oil boiler or generator is necessary in that case. Pellets are easy to transport and store, they do not require a connection to centralized supply system, and have relatively high energetic efficiency.

Installation of a special pellet stove allows using pellets as fuel also for small industrial and agricultural complexes. Specialized pellet stove ensures higher efficiency than ordinary stoves and is comparable to gas boilers.

Pellets are mostly produced from local wood that ensures maximum utilization of this renewable resource. Pellet heating is considered to be one of the most environment-friendly, as it does not create excessive pollution, produces a very small amount of waste (which is traditionally used as a fertilizer by many households) and ensures full utilization of timber, processed by woodworking factories. Pellets are produced by chopping the pieces of wood into powder that is afterwards dried and processed in a granulator mill (pellet-mill) that forms it into pellets.

Established in the year 2013, NDINAMIKA SIA sells and delivers wood pellets to the final customers across the Latvia. Current business scheme assumes purchasing the stock of pellets during the low season (summer) and gradually selling it to the households and business consumers during the high season (autumn and winter).

The need for additional funds is justified by current situation on the Latvian biomass fuel market that is characterized by high seasonality and continuously growing demand for wood pellets, woodchips, and wood briquettes. Summer season is characterized by lower prices at which the fuel is available for purchase from the producers, however, up to 6 months payment delay from the final customer has to be faced in that case.

Covering this gap with the help of Envestio financing will allow purchasing additional stock now and getting extra profits during the winter season, when the price of woodchips reaches its maximum, and repay the investment principal to Envestio participants.

Market

During the last years Latvian market for biomass fuel that includes wood pellets, woodchips, wood briquettes, and similar products was characterized by increasing demand for the qualitative product. The size of Latvian woodworking industry, which is the main internal supplier of the raw materials for further processing, remains relatively stable; at the same time, the number of customers has been increasing almost exponentially.

While cogeneration power plants and producers of wooden pellets are looking to purchase growing amounts of the raw materials, a bigger number of consumers is looking to purchase biomass fuel for their business and private needs. Given the constant supply and increasing number of foreign customers from countries like Estonia, Lithuania, and Poland this logically results in price increase and even product shortage on the market.

Besides the increasing demand the market also faces extreme seasonality. Wood pellets can be purchased at cheaper price during the summer, at the same time, during the winter not all customers can handle the price growth (and still there is an excessive demand). In these conditions, a company that can purchase the wood pellets during the low season, store those in a dry warehouse thus preserving the quality, and sell during the period of higher prices may achieve extra profits.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 17.10.2018 – EUR 17.26
  • 17.11.2018 – EUR 17.84
  • 17.12.2018 – EUR 17.26
  • 17.01.2019 – EUR 17.84
  • 17.02.2019 – EUR 17.84
  • 17.03.2019 – EUR 1016.11

Total expected return: EUR 1 104.15

 

New investment project in Latvia announced by Bulkestate – Luku Street II – Launch 17 september 2018

Bulkestate logo

Bulkestate announced today that it is preparing to launch a new investment project in Latvia, Riga.

Launch time: Monday / 17 September 2018 / 16:00 (EEST)

The property is located in Mārupe, which is one of the closest private housing areas to Riga. The main advantage of the region is the convenient traffic to the city centre, international airport and the seaside, at the same time preserving the green neighbourhood characteristic of the outskirts of the city.

Project information:

Interest rate: 13%
Investment target: 58,000 EUR
Loan period: 12 months
Loan to value: 50%
Security: Mortgage

New Envestio project – Fruits wholesale – factoring 3

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing the new investment project “Fruits wholesale – factoring 3”, Envestio continue cooperation with the representative of European food wholesale industry.

This loan is fully secured by commercial pledge and personal guarantee of the main beneficiary of SIA MERKURS-RIGANTE.

As usual, you can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment into food wholesaling industry, financing of working capital of a fruit wholesaler.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

Latvian company SIA MERKURS-RIGANTE has been working in the sphere of warehouse services and logistics since 1994. Recently the company launched a new business direction – delivery and wholesale of fresh fruits produced in Spain, Greece, Bulgaria, and Serbia on the market of Baltic states, Russia, Belarus, Kazakstan and other CIS countries. The assortment includes different kinds of stone fruits, strawberries, blueberry, citruses, apples, etc.

The business network is already active since June 2018. Having a number of contracted European suppliers, long-term experience in transportation and warehousing, possibility to use own infrastructure for the trade operations, necessary expertise in importation procedures, and high demand for high-quality product makes this business direction exceptionally promising and high-profitable.

SIA MERKURS-RIGANTE is looking to attract a factoring-type secured funding for the period of 6 months in order to finance additional deliveries of shipments of fruits to its partners within already established trade network.

Market

The market for imported fruits and berries in the Eastern Europe and CIS is still considered fairly underdeveloped and full of opportunities in comparison to Western Europe and US. A lot of people there still do not consider fresh fruits and berries to be an essential part of their food basket as consumption of these products currently is approximately 3,5 times lower than in the West. At the same time, as a result of the latest healthy lifestyle trends, growing personal income, and a number of other factors the demand for qualitative fruits and berries is increasing at a constant rate.

Increasing demand cannot be met with local supply, mainly due to the climate conditions, which are not favourable for growing good-quality fruits and berries as well as weaker and low-automated local farming sector. It provides a lot of opportunities for the companies that are able to import products of a necessary quality from other economic regions.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 13.10.2018 – EUR 17.26
  • 13.11.2018 – EUR 17.84
  • 13.12.2018 – EUR 17.26
  • 13.01.2019 – EUR 17.84
  • 13.02.2019 – EUR 17.84
  • 13.03.2019 – EUR 1016.11

Total expected return: EUR 1 104.15

 

US private equity-backed loan originator from Romania joins Mintos p2p marketplace

Mintos logo

The Mintos marketplace just got bigger as Credius now offers personal loans for investment in Romania. Credius is one of the five largest alternative lenders in Romania and it is backed by a private equity group from the United States, and you can invest in its personal loans listed in EUR now!

Credius is part of the American investment group of private equity funds New Century Holdings (“NCH”). NCH manages approximately USD 3 billion of capital through a network of nine offices in Eastern Europe, Russia and Brazil. NCH has been active on the Romanian market since 1994, particularly in such industries as real estate and finance & banking services.

“Romania, the leader of GDP growth in the European Union in 2017, is experiencing a transition from an offline to an online economy. Credius is both taking advantage of this opportunity and is one of the most important drivers of this transition”, says Andrey Buzgan, Credius CEO.

Credius is a lending company focused on the segment of instalment loans to individuals. The average Romania-issued loan on Mintos from Credius is EUR 750 with a repayment period of 12 to 24 months. You can expect a net annual return of up to 9.5%.

To align its interests with those of investors, Credius will retain 10% of each loan placed on Mintos on its balance sheet. All Romania-issued loans from Credius come with a buyback guarantee and Credius will undertake the obligations of repurchasing delinquent loans.

Credius started its operations in Romania in 2013. It is currently in the top five alternative finance market leaders in the country when comparing the number of customers, monthly volumes of new loan origination, and the size of its loan portfolio. Credius is a leading market player both with its innovative online technologies and in terms of sales volumes. Its branch network is one of the largest in Romania with more than 80 offices. The company’s activities are regulated by the National Bank of Romania.

Since its inception, Credius has issued 53 000 loans worth more than EUR 33 million. The company maintains a very strong balance sheet with no external debt on its books. In 2017 the company reached EUR 19 million in revenues and EUR 2 million in net profit. As of the end of June 2018, its loan portfolio of EUR 9.5 million had been financed exclusively by its shareholders through the injection of equity capital and subordinated loan as well as through the reinvestment of internally generated cash flows. Historically, the average part of its non-performing loan portfolio being overdue more than 60 days has been around 10%.

To obtain exposure to Credius loans, investors will be able to invest in loans issued by Mintos Finance to Credius, where repayments depend on the borrower’s payments. Each loan issued by Mintos Finance to Credius will be pegged to a respective loan issued by Credius to the final borrower. Mintos Finance is a Mintos group company.

New Envestio project – Urban mining tier 7

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing the project Urban mining tier 7, Envestio continues to expand successful cooperation with the representatives of the environmental-friendly recycling industry.

This investment project is available on exclusive conditions, ensuring higher return than other DAGRE projects. At the same time, it is also classified as secured debt limiting the project-related risks.

As usual, you can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment into technology sector, financing of working capital of recycling plant.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

DAGRE is an international company with successful experience in the sphere of recycling of technological raw materials that contain different precious metals such as silver, gold, platinum, etc. DAGRE’s production capacities provide full cycle of processing the raw materials, from initial expertise in the lab to grinding it using special automated machinery and equipment. Employed innovative technological process ensures preservation of 98% of the initial amount of precious metals, contained in the raw materials. Production complex consists of following segments:

  • Storage of Raw materials
  • Manual and mechanical disassembly workshop
  • Enrichment workshop
  • Storage of ready produce.

DAGRE is capable of processing extremely wide range of raw materials, which provides the company with additional competitive advantage on the market. Obsolete home electronics, computer hardware, written-off equipment and machinery from plants and factories, even details from old trains and military objects – all this can be utilized. Current company facilities allow recycling of more than 2000 tons of aforementioned raw materials per year, and turning them into enriched “concentrate” with high saturation of precious metals ready for further sale.

The enriched “concentrate” is purchased by special factories, which recycle it further, into pure non-ferrous metals, such as Aurubis GmbH factory in Hamburg, Germany that is currently the main buyer of DAGRE’s product. DAGRE and Aurubis GmbH have concluded a long-term cooperation contract.

DAGRE is receiving raw materials from wide variety of suppliers in the Eastern European region, which is still far behind the rest of the Europe in terms of percentage of obsolete equipment going through proper utilization process. In combination with efficient and transparent logistics processes it makes economies of scale possible.

Market

DAGRE is one of few companies in the region that has direct access to Russian market of necessary raw materials. Russian recycling market is noticeably underdeveloped in comparison with Western markets, therefore, supply of raw materials is limited only by the production capacities of processing company and money it can invest into the process. At the same time, entrance to this market is very complicated due to big amount of different formalities and strict customs procedures, which must be observed. Here DAGRE enjoys a noticeable competitive advantage, as it already has all the necessary legal and operational expertise is this sphere.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 05.10.2018 – EUR 18.08
  • 05.11.2018 – EUR 18.68
  • 05.12.2018 – EUR 18.08
  • 05.01.2019 – EUR 1 018.68

Total expected return: EUR 1 073.52

New Envestio project – Fruits wholesale – factoring 2

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing the new investment project “Fruits wholesale – factoring 2”, Envestio continue cooperation with the representative of European food wholesale industry.

This loan is fully secured by commercial pledge and personal guarantee of the main beneficiary of SIA MERKURS-RIGANTE.

As usual, you can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment into food wholesaling industry, financing of working capital of a fruit wholesaler.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

Latvian company SIA MERKURS-RIGANTE has been working in the sphere of warehouse services and logistics since 1994. Recently the company launched a new business direction – delivery and wholesale of fresh fruits produced in Spain, Greece, Bulgaria, and Serbia on the market of Baltic states, Russia, Belarus, Kazakstan and other CIS countries. The assortment includes different kinds of stone fruits, strawberries, blueberry, citruses, apples, etc.

The business network is already active since June 2018. Having a number of contracted European suppliers, long-term experience in transportation and warehousing, possibility to use own infrastructure for the trade operations, necessary expertise in importation procedures, and high demand for high-quality product makes this business direction exceptionally promising and high-profitable.

SIA MERKURS-RIGANTE is looking to attract a factoring-type secured funding for the period of 6 months in order to finance additional deliveries of shipments of fruits to its partners within already established trade network.

Market

The market for imported fruits and berries in the Eastern Europe and CIS is still considered fairly underdeveloped and full of opportunities in comparison to Western Europe and US. A lot of people there still do not consider fresh fruits and berries to be an essential part of their food basket as consumption of these products currently is approximately 3,5 times lower than in the West. At the same time, as a result of the latest healthy lifestyle trends, growing personal income, and a number of other factors the demand for qualitative fruits and berries is increasing at a constant rate.

Increasing demand cannot be met with local supply, mainly due to the climate conditions, which are not favourable for growing good-quality fruits and berries as well as weaker and low-automated local farming sector. It provides a lot of opportunities for the companies that are able to import products of a necessary quality from other economic regions.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 03.10.2018 – EUR 18.08
  • 03.11.2018 – EUR 18.68
  • 03.12.2018 – EUR 18.08
  • 03.01.2019 – EUR 18.68
  • 03.02.2019 – EUR 18.68
  • 03.03.2019 – EUR 1016.88

Total expected return: EUR 1 109.08

Kviku from Russia has just launched on Mintos p2p lending marketplace

Mintos logo

A new loan originator from Russia has just launched on the Mintos peer-to-peer lending marketplace! Kviku is a leading fintech platform which currently provides instant online point-of-sale and instalment credit solutions to borrowers in Russia and Kazakhstan. In 2018, the company plans to expand its services into Spain and Poland. Kviku is the sixth loan originator with operations in Russia to join Mintos and you can now invest in its Russia-issued consumer loans listed in Euro (EUR) and Russian ruble (RUB).

Kviku was established in 2013 and was one of the first fintech company to challenge the traditional banks in Russia. The company operates completely online and offers a fast, reliable, convenient and transparent service. Kviku issues loans through its virtual credit card and point-of-sale partners and holds a microfinance license in Russia. First-time borrowers can take a loan up to EUR 300 to purchase online or offline goods and services. For repeat borrowers, the company offers cash instalment loans up to EUR 1 500 with a six month repayment period. Both loan products will be available for investment on Mintos.

“We are excited to be among the first originators to offer point-of-sale loans on the Mintos marketplace. The Russian online lending market is one of the most regulated globally and investors will surely benefit from the extra layer of regulation. Kviku is a leading European online point-of-sale lender and we look forward to diversifying our funding sources for loans that we issue in all of our countries of operations via our strategic partnership with Mintos,” says Kviku Founder and CEO Nikita Lomakin.

The average Russia-issued loan from Kviku is EUR 500 and around RUB 35 000. The average maturity of the loans is six months. For its loans listed in EUR, you can expect a net annual return of up to 10% in EUR and up to 17% for its loans listed in RUB.

All loans from Kviku will be secured with a buyback guarantee and will be repurchased if they become delinquent for 60 days or more. The company also offers investors another layer of risk mitigation, as it will keep 10% of each loan on its balance to maintain its skin in the game.

As of July 31, 2018, Kviku had issued 250 000 loans worth over USD 15 million. The company has experienced 10 times the amount of growth over the last 12 month, and has a net loan portfolio of USD 8 million.

Kviku prides itself on its fast service, due to its efficient credit risk assessment. The company has the shortest online application time in the industry and can analyse more than 10 thousand Big Data parameters within 20 seconds. The company uses over 30 databases to assess the creditworthiness of its borrowers.

Kviku is made up of a team of 25 employees who have helped create and maintain the convenient business model of the company. As a result, it has processed more than 700 000 applications. The typical borrower of Kviku is aged between 20-35 years old, has an average monthly income of EUR 1 000 and is considering to make an online or offline purchase but doesn’t have sufficient funds. Kviku’s business model assumes less risk compared to traditional payday loans, as only repeat borrowers get access to cash loans, whereas new clients can apply for non-cash loans to purchase goods or services.

New Envestio project – Biomass fuel – factoring 3, final lot

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing the project Biomass fuel – factoring 3, final lot (this is the final project for this season from this Project Owner.), Envestio continues the successful cooperation with the representatives of the environmental-friendly energy industry.

This loan is fully secured by commercial pledge and personal guarantee of the main beneficiary of RIETUMU ENERGIJA SIA.

As usual, you can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment in energy sector, factoring-type financing for a woodchips trading company.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

The company RIETUMU ENERGIA SIA is a venture that successfully works on the market of production and sale of woodchips. Woodchips are being used as raw material for a big number of cogeneration-type power plants across the Baltic region. This type of produced heat and electric energy is considered to be one of the most environment-friendly, as it does not create excessive pollution and ensures full utilization of timber, processed by woodworking factories.

Founded in 2013, RIETUMU ENERGIA SIA is cooperating with an established pool of buyers that ensures necessary and stable demand for woodchips. This pool is formed by several small and medium cogeneration power plants and Tukums city municipal company that provides heating to the city.

On the supply side RIETUMU ENERGIA SIA cooperates with big Latvian woodworking factories SIA Stiga RM un AS Latvijas Finieris, processes own timber as well as purchases imported raw materials.

The need for additional funds is justified by current situation on the Latvian woodchips market that is characterized by high seasonality and continuously growing demand for this type of raw materials. Summer season is characterized by lower prices at which woodchips are available for purchase from the bigger suppliers, however, up to 6 months payment delay from the final customer has to be faced in that case.

Covering this gap with the help of Envestio financing will allow getting extra profits during the winter season, when the price of woodchips reaches its maximum, and repay the investment principal to Envestio participants.

Market

During the last years Latvian market for woodchips was characterized by increasing demand for the qualitative product. The size of Latvian woodworking industry, which is the main internal supplier of raw woodchips for further processing, remains relatively stable; at the same time, the number of customers has been increasing almost exponentially. Cogeneration power plants and producers of wooden pellets are looking to purchase growing amounts of the raw materials. Given the constant supply and increasing number of foreign customers from countries like Estonia, Lithuania, and Poland this logically results in price increase and even product shortage on the market.

Besides the increasing demand the market also faces extreme seasonality. Woodchips can be purchased at cheaper price during the summer, at the same time, during the winter not all customers can handle the price growth (and still there is an excessive demand). In these conditions, a company that can purchase the woodchips during the low season, store it, and sell during the period of higher prices may achieve extra profits.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 27.09.2018 – EUR 17.84
  • 27.10.2018 – EUR 17.26
  • 27.11.2018 – EUR 17.84
  • 27.12.2018 – EUR 17.26
  • 27.01.2019 – EUR 17.84
  • 27.02.2019 – EUR 1017.84

Total expected return: EUR 1 105.88

New investment project in Latvia announced by Bulkestate – Nometnu Street – Launch 28 august 2018

Bulkestate logo

Bulkestate announced today that it is preparing to launch a new investment project in Latvia, Riga.

Launch time: Tuesday / 28 August 2018 / 17:00 (EEST)

Project

Bulkestate OÜ has signed a purchase agreement for a property (land 2,077 square metres and building) located on Nometnu 18, Riga. The property is a part of Riga’s famous Art Noveau collection, a 4-storey apartment building in the Āgenskalns district. The surrounding area is a mix of residential houses and light commercial facilities. It is a convenient location, only 10 minutes away from the city centre and 15 minutes from the Riga airport. The building was owned and managed by the University of Latvia as a residential property.

The property includes 12 apartments and two commercial premises as well as an adjacent wooden building. All apartments and the wooden building have been reserved by buyers with contracted sales revenue 866,000 euros and 86.6 thousand euros paid to Bulkestate as a reservation deposit.

Location, quality of the building and significant discounts to the market price have facilitated fast sales process and high commitment from the buyers to complete the purchase.

Commercial premises will be sold after completion of apartment sales process. The expected sales price for these is 250 thousand euros.

Loan

The loan amount will comprise EUR 800,000 and will carry a 17% annual interest rate.

The loan will be used to finance payment of purchase price and transaction costs and will be repaid by payments for sold apartments.

Security

The loan is secured by a first rank mortgage on the building. The market price of the building has been defined as EUR 1,400,000 (LTV ratio is 57%).

The borrower

For technical reasons, loan agreement will be signed by LP Private Property SIA (a company controlled by Bulkestate OÜ) who will lend these funds to Bulkestate OÜ to pay the sellers of the building and associated transaction costs.

All funds received by Bulkestate from investors will remain at Bulkestate and will be directly used to complete the acquisition of the property.

Repayment schedule

Loan and accrued interest will be paid within 3 months.

*Bulkestate incentive payment

For this project Bulkestate offers the following special incentive pay (cash-back) for investors:

  • Investors making EUR 10,000 or larger investment will receive 1% incentive payment from the invested amount (representing 4% annual interest rate), while
  • Investors making EUR 25,000 or larger investment will receive 2% incentive payment from the invested amount (representing 8% annual interest rate).

 

New Envestio project – Biomass fuel – factoring 2

Envestio logo

Envestio informed today that a new investment opportunity is available at the portal to all registered participants.

By introducing the project Biomass fuel – factoring 2, Envestio continues the successful cooperation with the representatives of the environmental-friendly energy industry.

This loan is fully secured by commercial pledge and personal guarantee of the main beneficiary of RIETUMU ENERGIJA SIA.

As usual, you can invest any amount starting from 1 EUR. Minimum deposit to the investment account is EUR 100.

If you invest for the first time at Envestio don’t forget that you can get € 5 and a 0.5% cashback bonus for the investments made in the first nine months (270 days), more details HERE.

Investment opportunity

  • High-yielding investment in energy sector, factoring-type financing for a woodchips trading company.
  • Secured debt, 21% planned annual return.
  • Investment principal buyback is available at 5% penalty rate.

Project description

The company RIETUMU ENERGIA SIA is a venture that successfully works on the market of production and sale of woodchips. Woodchips are being used as raw material for a big number of cogeneration-type power plants across the Baltic region. This type of produced heat and electric energy is considered to be one of the most environment-friendly, as it does not create excessive pollution and ensures full utilization of timber, processed by woodworking factories.

Founded in 2013, RIETUMU ENERGIA SIA is cooperating with an established pool of buyers that ensures necessary and stable demand for woodchips. This pool is formed by several small and medium cogeneration power plants and Tukums city municipal company that provides heating to the city.

On the supply side RIETUMU ENERGIA SIA cooperates with big Latvian woodworking factories SIA Stiga RM un AS Latvijas Finieris, processes own timber as well as purchases imported raw materials.

The need for additional funds is justified by current situation on the Latvian woodchips market that is characterized by high seasonality and continuously growing demand for this type of raw materials. Summer season is characterized by lower prices at which woodchips are available for purchase from the bigger suppliers, however, up to 6 months payment delay from the final customer has to be faced in that case.

Covering this gap with the help of Envestio financing will allow getting extra profits during the winter season, when the price of woodchips reaches its maximum, and repay the investment principal to Envestio participants.

Market

During the last years Latvian market for woodchips was characterized by increasing demand for the qualitative product. The size of Latvian woodworking industry, which is the main internal supplier of raw woodchips for further processing, remains relatively stable; at the same time, the number of customers has been increasing almost exponentially. Cogeneration power plants and producers of wooden pellets are looking to purchase growing amounts of the raw materials. Given the constant supply and increasing number of foreign customers from countries like Estonia, Lithuania, and Poland this logically results in price increase and even product shortage on the market.

Besides the increasing demand the market also faces extreme seasonality. Woodchips can be purchased at cheaper price during the summer, at the same time, during the winter not all customers can handle the price growth (and still there is an excessive demand). In these conditions, a company that can purchase the woodchips during the low season, store it, and sell during the period of higher prices may achieve extra profits.

Sample repayment schedule

Envestio participant’s investment – EUR 1 000.00
Payments:

  • 23.09.2018 – EUR 17.84
  • 23.10.2018 – EUR 17.26
  • 23.11.2018 – EUR 17.84
  • 23.12.2018 – EUR 17.26
  • 23.01.2019 – EUR 17.84
  • 23.02.2019 – EUR 1017.84

Total expected return: EUR 1 105.88

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