Gunvor Closes Innovative US $745 Million Facility Linked to Sustainability Targets
15 October 2018 - 11:00AM
Related savings will go to support new
Gunvor Foundation
Gunvor Group (“Gunvor”) has closed an innovative US $745 million
secured borrowing base facility (“Facility”) that includes
performance commitments related to Gunvor’s sustainability targets.
Gunvor is the first energy commodities trading company to close a
financing in which the interest rate will be dependent on the
company’s year-on-year improvements in areas such as transparency,
governance and the environment. The Facility, originally launched
at US $625 million in 2012, was a renewal to provide for the
working capital requirements of the company’s Antwerp and Rotterdam
refineries. It was significantly oversubscribed to US $745 million
through the addition of new lenders.
The Facility was arranged by ING Bank, who acted as sole
Coordinator and Active Bookrunner while maintaining its roles as
Security Agent, Facility Agent and Fronting Bank. The structure for
the sustainability targets was created by Gunvor in collaboration
with ING Bank as the Sustainability Coordinator and supported by
the consortium of banks. Gunvor will receive a discount on its
interest rate if the sustainability targets have been met and
vice-versa, if Gunvor underperforms on the sustainability targets,
a premium will be added to the interest rate. This initiative will
serve as a test run for a more expanded future program for the
company’s financings.
“By partnering with our banks to set goals that achieve
substantive results, we are demonstrating the seriousness with
which we integrate sustainability into our business,” said Jacques
Erni, Gunvor Group CFO.
The sustainability targets are focused on the “environment”,
“social impact” and “governance”, and specifically address areas
like reductions in CO2 emissions, waste and water management,
improvements to personnel safety at the refineries, transparency
reporting related to feedstock origination (within the parameters
of the company’s support for the Extractive Industries Transparency
Initiative, or EITI) and others.
“Gunvor’s imperative has always been to take actions that are
meaningful and credible, and we have worked closely with our
banking partners to keep ahead of the market’s evolving
expectations for sustainability in business and finance,” said Ben
Winterton, Gunvor Group’s head of HSEC (health, safety,
environment, human rights and communities).
Related savings from the potentially lower interest rate will go
to supplement funding for the recently launched Gunvor Foundation,
the company’s not-for-profit entity dedicated to philanthropic
giving.
“ING is happy to be Gunvor’s partner in its sustainability
journey. We expect this innovative transaction will serve as an
example of how we and our peers can provide energy commodity
trading clients with financial solutions which also address the key
sustainability challenges in this sector,” said Patrick Arnaud,
managing director for Trade Commodity Finance at ING Bank.
The Facility’s increase was made possible thanks to the
continuous support of the original lenders renewing and some
increasing their participation levels, together with new
entrants.
The banks participating in the Facility are as follows:
- ING Belgium, Brussels, Geneva Branch
- DBS Bank Ltd., London Branch
- Société Générale
- Cooperatieve Rabobank U.A.
- ABN Amro Bank N.V.
- CA Indosuez (Switzerland) SA
- Credit Suisse (Switzerland) Ltd.
- Mizuho Bank Europe N.V.
- Nedbank Limited, London Branch
- Sumitomo Mitsui Trust Bank, Limited (London Branch)
- UniCredit Bank AG
- KfW IPEX-Bank GmbH
- MUFG Bank, Ltd.
- Raiffeisen Bank International AG
About Gunvor GroupGunvor Group is one of the
world’s largest independent commodities trading houses by turnover,
creating logistics solutions that safely and efficiently move
physical energy from where it is sourced and stored to where it is
demanded most. With strategic investments in industrial
infrastructure—refineries, pipelines, storage, terminals, mining
and upstream—Gunvor further generates sustainable value across the
global supply chain for its customers. More information can be
found at www.GunvorGroup.com or @Gunvor.
About Gunvor FoundationGunvor Foundation
provides scholarships, grants, and donations (impact investing) for
initiatives that further the mission of empowering individuals to
contribute meaningfully to the development of healthy communities,
the reduction of poverty, and the improvement of environmental
conditions on local and global levels. More information can be
found at www.Gunvor-Foundation.com
Contact
Seth Thomas Pietras stp@gunvorgroup.com +41 79 870
6209