Charterer and trader Trafigura Group has clinched another huge sustainability-linked loan package as it furthers its ESG credentials.
The company, which also owns ships, said the total deal is worth $2.4bn.
The Asian financing is broken down into a one-year $700m revolving credit facility (RCF), a 12-month Chinese yuan-denominated loan equivalent to $890m, and a three-year term loan worth $810m.
The cash will pay off a maturing three-year term loan tranche from 2018 and also two dollar and yuan facilities from 2020, as well as being used for general corporate purposes.
The new transactions were substantially oversubscribed and upsized from their initial launch amount of $1.5bn, with 36 banks involved, including eight lenders new to Trafigura.
Christophe Salmon, Trafigura's chief financial officer, said: "The implementation of a sustainability-linked loan structure in the new facilities, in line with our European RCF that closed in March 2021, was a very important step to demonstrate Trafigura's commitment to champion the ESG agenda in our sector."
He added: "Trafigura's exceptional business and financial performance underpinned the commitment of our banks to these facilities, especially the three-year tranche, which shows confidence about our ability to weather different commodity and credit cycles."
Strong Chinese involvement
Lead arrangers of the revolver were China's Bank of Communications, DBS Bank, Standard Chartered and Sumitomo Mitsui Banking Corp.
Development Bank of Japan was also involved as lead arranger in connection with the syndication of the three-year term loan facility.
Agricultural Bank of China and China Construction Bank led the yuan financing.
Trafigura's first sustainability-linked loans were part of a huge $5.5bn financing round in March.
The group said at the time that its progress in decarbonisation and responsible business practices — as well the potential to reach further milestones — has allowed it to build eco elements into its funding.
Loans will come with three key performance indicators to be tested annually by a third-party verifier.
These relate to cutting operational greenhouse gas (GHG) emissions under the directly controlled Scope 1 and 2 categories, as well as the responsible sourcing of metals and the growing of Trafigura's renewable power portfolio.
Lenders will apply a discount or penalty on interest depending on performance.
