The German energy service provider ista is linking its financing structure to the company’s sustainability successes. The new ESG-linked syndicated loan in the amount of up to EUR 1.85 billion in total was signed with an international consortium of banks. In this way, the company intends to further strengthen its strategic orientation as a sustainable service and technology partner to the real estate industry.“
Sustainability is part of ista’s DNA. Ten years ago, we were the first company in our branch of industry to publish a sustainability report. Now we are the first to adopt a sustainable financing structure,” says Thomas Lemper, CFO of ista. “The new financing is a clear commitment to our long-term sustainability strategy. Therefore, we are delighted that a wide group of banks is supporting our path to a sustainable and climate-neutral future.”
With the new loan, ista is now moving into the investment grade range. The term of the loan is five years, including an extension option of up to two years. The lenders are a total of eleven banks, including Commerzbank (Facility Agent) and UniCredit Bank AG (Documentation Agent). As is customary with ESG financing (ESG = “Environmental, Social and Governance”), the variable interest rates are additionally linked to the fulfilment of sustainability targets. In the case of ista, these will include the CO2 emissions per employee and the further expansion of the digital service infrastructure, which should be as resource-efficient as possible. If ista achieves the agreed sustainability targets, it can reduce the credit margin; conversely, the margin increases if the targets are not met.
The sustainability KPIs will be audited by SGS-TÜV Saar GmbH. “A binding ESG element was very important to us right from the very beginning of the loan negotiations,” says Jan-Eric Meyer-Hubbert, Head of Corporate Controlling & Treasury, Finance at ista. “The successful refinancing despite the coronavirus crisis shows the banks’ confidence in our corporate and sustainability strategy.”
“With an ESG element in this order of magnitude ista is sending a clear signal with regard to its own sustainability goals,” says Dr Roland Mees of ING Bank, which as lead ESG coordinator developed the sustainable financing concept and implemented it together with UniCredit Bank AG and the Sumitomo Mitsui Banking Corporation Group. “The business model and ista’s previous sustainability successes convinced us that the company is the ideal candidate for a financing structure linked to sustainability criteria,” Dr Mees continues.
With the new financing, ista is replacing a previous, non-ESG-linked credit line in a similar amount concluded in 2017 and, at the same time, is creating additional financial scope for the company’s growth strategy. “We see digitalisation in the real estate industry as a great opportunity for our core business and beyond,” says CFO Lemper. “The new financing gives us the flexibility to continue investing in products and services that help our customers and also their tenants make buildings climate-friendly, safe and comfortable.” Only recently, ista established a venture hub in which the company bundles new business models, start-up investments and partner projects around its core business.
About ista International GmbH
ista adds sustainable value to buildings for their residents and owners. To achieve this, we manage data and processes that make buildings climate-friendly, safe and comfortable. With our products and services, residents and owners can save energy and together contribute to climate protection. Our product and service world is digital-based. As a driver of innovation, we are systematically gearing our infrastructure to the Internet of Things. Worldwide we already have over 28 million connected devices in operation and are developing solutions for the intelligent and energy-efficient building of tomorrow. We employ over 5,800 people in 22 countries, our products and services are used worldwide in over 13 million units (apartments and commercial properties). The ista Group recorded sales of EUR 909 million in 2019.