BMO Financial Group is serving as lead sustainability structuring coordinator for a three-year, $250 million sustainability-linked revolving credit facility for Seaspan, a containership leasing company. BMO Capital Markets and Citigroup Global Markets are mandated lead arrangers and bookrunners for the facility, with BMO Capital Markets acting as co-sustainability coordinator.
The facility includes terms that reduce or increase the borrowing costs as Seaspan meets or misses targets related to carbon intensity of vessels and sustainability-linked contracts. More specifically, the deal, which is an amendment to an existing credit facility, introduces a margin adjustment incentive mechanism tied to the alignment of the carbon intensity of Seaspan’s vessels with the International Maritime Organization’s 2050 decarbonization trajectory. The deal also incorporates sustainability-linked provisions into charter contracts.
“As the leader in the industry, we feel it is Seaspan’s duty while also in alignment with our strategic objectives to be at the forefront of environmental sustainability initiatives,” Matt Borys, head of capital markets and treasurer of Seaspan, said. “Seaspan has a long history in this regard and have been designing and building vessels with industry leading fuel efficiency for over 10 years. This innovative SLL structure created in partnership with BMO allows Seaspan to go beyond technology. We have set ambitious targets aimed at aligning our environmental performance with our financial objectives as well as those of our customers, creating a true supply chain approach to decarbonization.”
“As sustainable lending continues to grow around the world, BMO is proud to be the leading Canadian bank for SLL structuring. Helping clients like Seaspan reach their ESG goals is an important way BMO is boldly growing the good in business and life and a great example of the progress our clients across industries can make as we work together to build a more sustainable future,” Jonathan Hackett, head of sustainable finance at BMO Capital Markets, said.
