By Andrei Skvarsky.
XacBank, one of Mongolia’s largest banks, has agreed to lend $10m to Mongolia Holdings, the Hertz Equipment Rental franchisee for Mongolia, as the first tranche of a proposed $40m credit line from the lender.
XacBank, the flagship company of Mongolia’s TenGer Financial Group, serves retail customers, small and medium-sized businesses and large corporations. It operates in all of Mongolia’s 21 provinces and capital city Ulaanbaatar and has more than 700,000 customers.
Mongolia Holdings leases out, sells and maintains equipment for use in construction, mining, materials-handling and other industries in Mongolia, a commodity-rich nation of three million with a rapidly growing economy.
According to a statement from Mongolia Holdings, the planned $10m loan is based on an agreement signed on the rental company’s behalf by its wholly owned Mongolian subsidiaries HERC, LLC, and Equipment Rental, LLC.
The statement said Mongolia Holdings was currently starting talks with global construction companies in offering to satisfy their 2015 equipment rental needs in the Asian country.
Mongolia Holdings says it plans to explore capital markets for more funds for setting up equipment maintenance facilities, building out its mobile services vehicles, employee training and ongoing transactions.
The loan deal “culminates over three years of planning, due diligence, hard work and execution” and “completes a truly historic milestone for the Company and a significant corporate financing within Mongolia”, the statement quoted Mongolia Holdings chief executive Gary Kucher as saying.