Industrial and Commercial Bank of China (Europe) and China Construction Bank (Europe) have participated in a bank syndicate for a 4 billion Polish zloty (US$840 million) sustainability-linked loan for Tauron Polska Energia.
Tauron is the largest electricity distributor in Poland, supplying 54 terrawatt-hours of power to 5.8 million end-customers last year. It is also the country‘s second largest power generator and the largest supplier of heat in Upper Silesia.
Funds from the syndicated loan will be used to refinance existing loans and finance corporate-wide expenditures, excluding those related to coal assets.
Aside from ICBC and CCB, other members of the loan syndicate included PKO Bank Polski, Bank Pekao, CaixaBank, Citi subsidiary Bank Handlowy, Erste Group Bank, and Santander Bank Polska. Norton Rose Fulbright’s banking and finance practice in Warsaw advised the bank lenders.
The interest rate on the funds made available under the loan agreement will be calculated on the basis of a variable interest rate plus a margin that depends on the fulfillment of certain sustainable development targets, measured through such indicators as emission reduction rate and increase in the share of renewable energy sources in the group’s generation structure. An independent auditor will confirm the accuracy of the calculations.
Last October Tauron received a 2.8 billion zloty loan from the European Investment Bank (EIB). This was the largest corporate loan ever granted in Poland by the EIB for purposes other than the development of transport infrastructure. The entire loan is being used to cover investment expenditure in power distribution grids in the southern and south-western parts of Poland.