EQT signs "largest ever" ESG-linked credit facility

The loan, which is currently at €2.3bn and has an upper limit of €5bn, is being provided by a syndicate of 17 banks including BNP Paribas and SEB acting as sustainability coordinators, and BNP Paribas as agent and sustainability agent. The tenor of the loan is three years, a source familiar with the matter told Unquote. 

The pricing for the bridge financing facility will be linked to EQT's targets around diversity, climate, its governance model and commitment to transparency.

The pricing mechanism is designed to incentivise the performance of portfolio companies in the areas of gender equality on the board of directors, renewable energy transition, and a fundamental sustainability governance platform.

The GP and its future portfolio companies will work with advisers to develop roadmaps to deliver on the KPIs on which they will report quarterly and be audited annually. The aggregated results from the companies' ESG efforts will later be compared with the pre-set KPI targets. The portfolio's averaged fulfilment rate will impact the ESG-bridge facility's interest rate.

Per Franzén, partner and co-head of the EQT Private Equity advisory team, said: "This is a game-changing moment for EQT, but also the private equity industry, further evidencing how our industry can benefit from sustainable financing."

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