Tallinna Vesi added sustainability criteria to its syndicated loan

    Tallinna Vesi added sustainability criteria to its syndicated loan

AS Tallinna Vesi added sustainability criteria to its syndicated loan agreement to support the company’s strategic objectives, with SEB Estonia acting as the sustainability coordinator for the loan.
The syndicated loan agreement of Tallinna Vesi includes sustainability criteria, together with annual targets of the company focusing on the environmental, social and governance (ESG) topics. Following this amendment, approximately 82% of Tallinna Vesi’s total loans will be green and sustainability-related instruments, underlining the strength of the company’s sustainability strategy and providing a solid foundation for future projects.
“The climate situation and its impact on the water system underlines the need for additional measures in the water sector,” said Taavi Gröön, CFO of Tallinna Vesi. “The sustainability-related addition to the 2023 contract perfectly supports Tallinna Vesi’s strategy to be part of the natural water cycle – to provide customers with clean drinking water that they can use with confidence, knowing that this water will be returned to nature in the purest possible form,” Gröön said.
The syndicated loan signed in May 2023 with SEB Pank AS, Swedbank AS and the Estonian branch of OP Corporate Bank plc is supporting Tallinna Vesi’s investments in the water network and water treatment plant, as well as in wastewater collection and wastewater treatment plant. The investments are essential to reduce the environmental impact of water consumption, ensure the continuity of vital services and contribute to sustainable urban development.
The interest margin on the loan will depend on Tallinna Vesi’s achievement of specific sustainability targets related to renewable electricity production, reduced electricity consumption and minimised water losses.
The inclusion of sustainability targets in loan agreements will not bring significant financial implications. The syndicated loan amounts to €91 million, of which €37.5 million was disbursed in 2023.

AS Tallinna Vesi is the largest water utility in Estonia, providing services to more than 24,900 private customers and businesses and 470,000 end consumers in Tallinn and its surrounding municipalities. Tallinna Vesi is listed on the main list of the Nasdaq Tallinn Stock Exchange. The largest shareholdings in the company are held by the City of Tallinn (55.06%) and the energy group Utilitas (20.36%). 24.58% of the company’s shares are freely floating on the Nasdaq Tallinn Stock Exchange.

Taavi Gröön
AS Tallinna Vesi
CFO
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