Funds managed by Ares Management’s European direct lending strategy are serving as the sole lenders of £1 billion ($1.39 billion) of available debt facilities to the RSK Group, a privately-owned multi-disciplinary environmental business in the United Kingdom. According to a press release from Ares, this transaction marks the largest private credit-backed sustainability linked financing to date and will be used to refinance RSK’s existing credit facilities as well as to support its continued growth plans.
The new debt facilities include an annual margin review based on the achievement of sustainability targets, which are broadly focused on carbon intensity reduction and continual improvement to health and safety management and ethics. These targets are aligned to RSK’s corporate responsibility and sustainability route map, which forms the basis of its sustainability strategy, which is based on RSK’s sustainability pillars and the United Nation’s sustainable development goals. RSK anticipates interest savings in excess of £500,000 ($694,300) per year and has committed to donate a minimum of 50% of this margin benefit toward sustainability-related initiatives or charitable causes.
Founded in 1989, RSK is an environmental, engineering and technical services group currently comprised of more than 100 businesses with more than 6,000 specialists. The group, led by founder and CEO Alan Ryder, is headquartered in the United Kingdom and has an established presence in more than 40 countries around the world.
“We are excited to continue to grow our longstanding relationship with RSK through this significant financing that is a first for both of our businesses and further connects us to a shared sustainability commitment,” Michael Dennis, co-head of the Ares European direct lending strategy and partner of Ares Credit Group, said. “We have enjoyed the opportunity to be a financing provider to Alan and his team for nearly three years as they have executed on an impressive strategy to scale RSK’s capabilities and its mission of expanding ESG into its clients’ business model and practices. We are confident that the positive tailwinds for ESG across the spectrum of businesses and sectors will continue to drive demand for RSK’s service offering, and we are proud to support the company on this journey.”
“There are very few firms like Ares that possess the scale, flexibility and sharp focus on ESG to provide a sustainability-linked financing of this kind. This financing demonstrates our deep commitment to driving sustainable business practices not just within our clients’ businesses but also within our own,” Ryder said. “We look forward to continuing the great relationship we have with the Ares team while responsibly expanding our services and geographic footprint as we strive to bring the most comprehensive range of sustainable solutions to our clients.”