Natixis supports Trafigura Group as joint sustainability coordinator for the energy & metals commodity trading industry’s first sustainability-linked facility
Trafigura Group Pte Ltd. a market leader in the global commodities industry, has successfully closed a sustainability-linked facility, the first for an actor in the energy & metals commodity trading industry, in line with its aim to take a leading role in corporate responsibility within the global commodities industry. Natixis acted as joint sustainability coordinator for the transaction.
The European RCF facility comprises a USD1.9 billion 365-day European multi-currency syndicated revolving credit facility, which will be used to refinance the maturing USD1.9 billion 365-day facility dated March 6 2020, and an extended option on the 3-year USD3.6 billion tranche of its 2018 ERCF, thereby extending the facility by 365 days and maintaining a 3-year tenor.
Both the 1-year and 3-year tranches are structured as sustainability-linked syndicated facilities aligned with the LMA’s Sustainability Linked Loan Principles. Under this structure, the interest rate paid by Trafigura on the credit facilities will decrease or increase based on the group’s progress on three key performance indicators which are material to the commodity industry and Trafigura’s business profile while responding to significant sustainability challenges.
The first KPI requires Trafigura to reduce its greenhouse gas emissions over the life of the facility (quantitative targets in Scope 1 & 2, Scope 3 target to be set by the end of 2023). The second KPI concerns the enlargement of Trafigura’s existing responsible sourcing program to cover all metals. The third KPI sets targets for the growth of the company’s renewable energy capacities. A sustainability auditor of international reputation will perform the annual verification of the group’s sustainability KPIs and the CSR annual report.
By proactively integrating sustainability KPIs into its financing, Trafigura becomes the first global commodities player to tangibly demonstrate its commitment towards achieving ambitious environmental and responsible sourcing targets, reducing its carbon footprint and diversifying its asset base towards renewable energy.
“The energy transition is central to our strategic dialogue with our global energy and natural resources clients. Traders are key players in the commodity supply chain and are part of the global solution. We are very proud to accompany and support Trafigura on this milestone strategic move,” said Frank Pluta, Global Head of Energy & Natural Resources Industry Group, Corporate & Investment Banking at Natixis.
“This facility is at the forefront of innovation in the sustainable finance space and will undoubtedly pave the way for further such transactions in the commodity loan space,” added Olivier Ménard, Executive Director, Origination & Advisory Team within the Green & Sustainable Hub, Corporate & Investment Banking at Natixis
The market responded very positively to the sustainability features embedded in the facility, which are rightly understood as enhancing the company’s CSR positioning and furthering its ability to transform its business to reduce its environmental impact.
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About Groupe BPCE
Groupe BPCE is the second-largest banking group in France. Through its 100,000 staff, the group serves 35 million customers – individuals, professionals, companies, investors and local government bodies – around the world. It operates in the retail banking and insurance fields in France via its two major networks, Banque Populaire and Caisse d’Epargne, along with Banque Palatine and Oney. It also pursues its activities worldwide with the asset & wealth management services provided by Natixis Investment Managers and the wholesale banking expertise of Natixis Corporate & Investment Banking. The Group's financial strength is recognized by four credit rating agencies with the following senior preferred LT ratings: Moody's (A1, stable outlook), Standard & Poor's (A, stable outlook), Fitch (AA-, negative outlook) and R&I (A+, stable outlook).
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