Aviva Investors & BNP Paribas complete first sustainability-linked transaction for Associated British Ports
Associated British Ports (‘ABP’) announces it has completed a sustainability-linked interest rate swap repack transaction with Aviva Investors, the global asset management business of Aviva plc (‘Aviva’), and BNP Paribas, according to ABP's release.
The 30-year Sterling Overnight Index Average (SONIA) linked interest rate swap transaction is believed to be the first SONIA-linked interest rate swap institutional repack transaction and the first institutional repack transaction to have sustainability-linked key performance indicators (KPIs) attached to it. The performance targets were subject to second party verification by ISS Corporate Solutions, to ensure they were both sufficiently material and ambitious in nature, whilst also remaining aligned to Loan Market Association sustainability-linked loan principles.
As part of the deal, a discount is offered to ABP on its hedging rate, provided that ABP meets certain sustainability-linked KPIs. These KPIs require ABP to achieve a significant reduction in its combined Scope 1 and Scope 2 emissions by 2030, building on the 36% reduction it has achieved in its absolute greenhouse gas emissions since 2014.
The agreement with ABP and BNP Paribas is the latest sustainability-linked financing Aviva Investors’ Real Assets business has invested in on behalf of Aviva UK Life, as it seeks to decarbonise its portfolio and transition to net zero by 2040. This transaction also highlights BNP Paribas’ commitment to innovating in sustainability-linked finance to support corporate and institutional clients.
As the UK’s leading ports group, ABP is committed to operating sustainably and supporting the decarbonisation of the wider UK economy. ABP continues to reduce its absolute carbon footprint through increased energy efficiency and investment in renewables. One of the largest corporate producers of solar energy, ABP is investing in solar and wind generation, and 17 of 21 ABP ports now have renewable energy generation projects providing clean power for the business, its customers, and the National Grid.
