· EQT launches ESG-linked fund level bridge facility - first of this size in the global fund financing markets
· Backed by a strong syndicate of leading global financial institutions
· Reinforces EQT's commitment to an integrated approach to sustainability and responsible ownership - enables execution on EQT's elevated societal ambitions
EQT today announced the entry into an ESG-linked Subscription Credit Facility related to the Private Equity business line (the "SCF" or "bridge facility"). This is an important milestone on EQT's sustainability and transparency journey, as the firm seeks to encourage the systemic change needed to reward positive contributions to society. The ESG-linked SCF is yet another example of how EQT will inspire and incentivize portfolio companies in improving their ESG (environmental, social and governance) performance. Adding an ESG perspective into the financing structure manifests EQT's commitment to an integrated sustainability approach and alignment with the global sustainability goals.
The SCF, which is currently at
EQT and the future portfolio companies will work closely with dedicated and experienced advisors to develop customized roadmaps to deliver on the elevated societal ambitions, with measurable KPIs on which they will report quarterly and be audited annually. The aggregated results from the portfolio 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. Or explained in a simplified manner - the better ESG progress the portfolio companies show, the better the financing terms. A win-win situation, as portfolio companies become more resilient through these actions.
Per Franzén, Partner and Co-Head of the EQT Private Equity Advisory Team, commented: "This is a game changing moment for EQT but also the private equity industry, further evidencing how our industry also can benefit from sustainable financing. For us, ESG plays a crucial role in how EQT future-proofs companies and with an ESG-linked bridge facility, we bring a new dimension to EQT's value creation process. By linking sustainability objectives to hard incentives, we are really challenging ourselves and the portfolio companies to fully embrace the potential of sustainability - it's really quite simple, sustainable business is good business and creates better value for all stakeholders."
Therése Lennehag, Head of Sustainability at EQT, added: "The entire financial community faces a challenge in accessing reliable and comparable ESG data - with this ESG-linked financing facility, we actively contribute to increasing the availability of high-quality ESG data, critical for the financial markets to be able to build a resilient and regenerative economy. We need innovation to accelerate system-wide transformation and it is particularly rewarding that we could launch the SCF despite the challenging marketplace we are currently seeing. It is a strong signal that leading global financial institutions are ready to partner with responsible investors and owners to ensure we all optimize for risk, returns and positive real-world outcomes."
EQT has long considered sustainability an integral part of its business and core to identifying and capturing value creating opportunities, and embarked on its dedicated sustainability and transparency journey over a decade ago. EQT was an early signatory of the UN PRI, has developed an industry leading sustainability framework to inspire and monitor development within its portfolio of companies while constantly raising the bar in how the firm integrates sustainability throughout its entire investment and ownership processes.
Contact
EQT Press Office, press@eqtpartners.com, +46 8 506 55 334
About EQT
EQT is a differentiated global investment organization with a 25-year track-record of consistent investment performance across multiple geographies, sectors and strategies. With strong values and a distinct corporate culture, EQT manages and advises funds and vehicles that invest across the world with the mission to generate attractive returns to the fund investors.
EQT's talent base and network allow it to pursue a thematic investment strategy and distinctive value creation approach, with the aim of future-proofing the companies which EQT invests in, creating superior returns to EQT's investors and making a positive impact with everything EQT does. EQT has more than
EQT is a thought leader within the private markets industry with deep expertise in responsible and long-term ownership, corporate governance, operational excellence, digitalization and sustainability. EQT has offices in 17 countries across
More info: www.eqtgroup.com
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