Royal Golden Eagle (RGE), a global group of firms headquartered in Singapore, has said that its member company Apical Group has closed $787 million in Sustainability-Linked Loans (SLLs), with strong support from Middle Eastern banks.

 

UAE’s largest bank, First Abu Dhabi (FAB), and Kuwait’s largest financial institution, the National Bank of Kuwait (NBK), were among the mandated lead arrangers, bookrunners and underwriters for the SLLs. Other Middle Eastern lenders in the consortium of more than 20 banks included the National Bank of Fujairah (NBF) and Invest Bank.

 

Tey Wei Lin, President, RGE, said: “Sustainability is at the core of our business model and sustainable financing is the way forward for RGE. Encouraged by the strong participation from Middle Eastern banks for Apical’s latest round of SLLs, we aim to contribute more to the growth of sustainable financing in the region, as we grow our business.”

 

Green debt

Green and sustainability-linked debt issuance in the Middle East and North Africa (Mena) region has outpaced global growth, rising from $4.5 billion in 2020 to $18.64 billion in 2021. In addition, 2022’s green debt issuance in the Gulf was record-setting as it exceeded oil, gas, and coal-related financing for the first time since 2015. 

 

FAB, which is leading the sustainable finance agenda in the Mena region, has extended some of the biggest SLLs in the region to notable names like Majid Al Futtaim and Etihad Airways.

 

Fawaz Abusneineh, Acting Head of Global Corporate Finance, FAB, said: “We are thrilled to have successfully closed this sustainability-linked syndicated loan to raise $787 million for Apical, which is part of the RGE group of companies. Acting as one of the mandated lead arrangers, bookrunners and underwriters, we have worked closely with RGE to promote this transaction in the Middle East and Asian loan markets. In line with FAB’s vision to promote sustainable economic growth in the region and our commitment towards the Net Zero Banking Alliance, we will continue to support our key clients, such as RGE, in raising sustainability-linked or green financing facilities.”

 

Global agribusiness

Structured as a two-year revolving credit facility, the $787 million SLLs will support Apical’s growth as a global agribusiness with strong downstream segments, covering oleochemicals, functional fats, animal feed and packed oil. Apical is scaling its global operations to address growing consumer needs and to address issues such as global food security. 

 

The latest round of SLLs by Apical reinforces an alignment of the company’s practices with Apical2030, its sustainability roadmap anchored by commitments and targets covering environmental and social pillars, including: attaining net zero by 2050; a 50% reduction in greenhouse gas emission intensity; and deeper engagement with suppliers to promote more sustainable practices. The goals under Apical2030 are aligned with Mena’s push on key environmental initiatives such as UAE Net Zero 2050 and Kuwait’s Sustainable Development Agenda 2030.

 

Four KPIs

Apical’s $787 million SLLs are tied to four key performance indicators (KPIs), with specific and measurable ESG targets to meet. These KPIs include raising the level of verified traceability to its plantations, increasing engagement of suppliers to promote sustainable practices and traceability, increasing the number of Roundtable on Sustainable Palm Oil (RSPO) certifications among smallholder farmers, and reducing greenhouse gas emissions through methane capture facilities.

 

In 2021, RGE was among the first non-property players in Singapore to secure an SLL, and the second-largest borrower of SLLs in the country. In 2022, including this latest round of $787 million SLLs, RGE raised approximately $1.6 billion in SLLs for its pulp and paper, and agri businesses.-- TradeArabia News Service