Apical Group, an agri-business processor of palm oil and member of the RGE group of companies, secured a $750 million sustainability-linked loan from a syndicate of lenders. First Abu Dhabi Bank is the mandate lead arranger bank and facility agent for the loan.
The loan, issued to Apical’s units Apical Middle East and AAA Oils & Fats, is structured as a two-year revolving credit facility and four-year term loan facility. Under the facilities, Apical is committed to meeting improvement targets for a range of environmental, social and governance (ESG) metrics as assessed by Environmental Resources Management, a London-headquartered provider of environmental, health, safety, risk and social issues consulting services.
“We congratulate Apical on this achievement,” Fawaz Abusneineh, acting head of global corporate finance at First Abu Dhabi Bank, said. “ESG is an increasing focus for borrowers and investors globally and it reflects very highly on Apical being amongst the first names in Asia — and companies in its industry sector — to embrace this. I am confident that such forward-thinking commitment to achieving its sustainability goals will position Apical advantageously for the future.”
The improvement targets are based on Apical’s commitment to ensure a sustainable supply chain. Performance against the pre-determined targets will be assessed on an annual basis for the loan period and incentives will be awarded accordingly. Apical will use the loan to finance working capital and capital expenditure requirements.
“This is a milestone for Apical and a testament to the commitment and confidence we have in our ESG performance,” Pratheepan Karunagaran, executive director at Apical Group, said. “The spirit of continuous improvement is deeply rooted in our corporate culture and we are motivated to perform even better to deliver against the loan targets set. We are grateful for the enthusiasm of our financiers and hope that our success will serve as a catalyst in further developing sustainability-linked financing in the sector.”
The loan facilities received participation from 22 banks in nine countries. Among the mandate lead arrangers and bookrunners are First Abu Dhabi Bank, E.Sun Commercial Bank, Mega International Commercial Bank, MUFG Bank, Bank Sinopac and Taishin International Bank.