Narrative
Full Description
Project narrative
On July 25, 2019, a syndicate of 13 banks — including the Bank of China (BOC) — entered into a €750,000,000 EUR ($840 million USD) sustainability-linked syndicated loan agreement with Dürr AG — a Germany-incorporated and headquartered mechanical and plant engineering firm listed on the Frankfurt Stock Exchange — for refinancing and general corporate purposes. This loan was divided into a €500 million EUR cash credit line tranche and a €250 million EUR guarantee line tranche. This loan carried a maturity period of five years with two one-year extension options with lender's consent, a final maturity date of July 25, 2024, and an interest rate based on a rate plus a variable margin. This loan was unsecured. As a sustainability-linked loan, the loan featured sustainability criteria created by EcoVadis including carbon dioxide emissions, water consumption, fair working relationships, and conditions at suppliers, against which the borrower's performance was assessed; based on this performance, the interest rate would ratchet positively or negatively. The loan came into force on August 7, 2019. The proceeds of the €500 million EUR cash credit line tranche were to be used for general corporate purposes and the proceeds of the €250 million EUR guarantee line tranche were to be used to secure standard obligations from mechanical and plant engineering to third parties; the borrower used the proceeds on August 7, 2019 to repay a €465 million EUR syndicated loan arranged in 2024 and due in 2021 without any prepayment fees. Record ID#103823 captures BOC's contribution. In addition to BOC, the following lenders contributed to the loan syndicate: BNP Paribas S.A., Commerzbank AG, Deutsche Bank AG, UniCredit Bank AG, DZ Bank AG, HSBC Bank PLC, ING Group N.V., JPMorgan Chase Bank, N.A., KfW IPEX-Bank GmbH, Landesbank Baden-Württemberg (LBBW), Mizuho Bank, and Banco Santander S.A. BNP Paribas, Commerzbank, Deutsche Bank, and UniCredit were the coordinators. Syndication was digitized via blockchain technology as a pilot. In July 2021, the lending syndicate entered into an amendment agreement with the borrower; in this amendment, the lenders extended the maturity period of the loan by two years — for a new maturity period of seven years — for a new final maturity date of July 2026, in line with the extension options in the loan agreement. Record ID#103824 captures BOC's contribution to this debt rescheduling. In December 2023, a syndicate of 12 banks entered into an amendment agreement with the borrower; in this amendment, the lenders up-sized the loan by €500,000,000 EUR (each tranche increased by €250 million EUR) and the extended the maturity period by 2.5 years — for a new maturity period of 9.5 years — for a new final maturity date of December 2028. It is unclear whether BOC remained a lender for this up-sizing and amendment.
Staff comments
1. AidData has assumed each lender contributed to each tranche, though AidData does not consider guarantees to be flows, so it has only coded based on the €500 million EUR tranche. The individual contributions of the 13 lenders to this €500 million EUR syndicated loan is unknown. For the time being, AidData has estimated the contribution of BOC by assuming that each lender contributed an equal amount (€38,461,538.4615 EUR) to the loan syndicate. 2. It is unclear whether BOC remained a lender for the December 2023 up-sizing and amendment, as the syndicate shrank. This issue merits further investigation.