Bank of China (Europe) Poland Branch contributes to a zł2.5 billion PLN syndicated loan to ENEA for refinancing, capital expenditure, and working capital purposes

Project narrative

On January 27, 2023, a syndicate of five banks — including the Poland Branch of Bank of China (Europe) S.A. — entered into a zł2,500,000,000 PLN syndicated facility agreement with ENEA S.A. — a Poland-incorporated power company headquartered in Poznań and listed on the Warsaw Stock Exchange, though its largest shareholder being the State Treasury of the Republic of Poland (52.29% equity stake) — for refinancing, capital expenditure, and working capital purposes. The loan was divided into a zł1,500,000,000 PLN sustainability-linked term loan facility known as 'Facility A' and a zł1,000,000 PLN revolving facility known as 'Facility B'. The loan carried a maturity period of five years with a two-year extension option, a final maturity date of January 27, 2028, and a variable interest rate based on 6-month WIBOR plus a margin dependent on the net debt to earnings before interest, taxes, depreciation and amortization (EBITDA) ratio. The term loan facility featured environment, social, and governance (ESG)-linked Key Performance Indicators (KPIs) concerning the carbon dioxide (CO2) emission reduction indicator and an increase in the share of renewable energy sources in the production structure of ENEA group, the achievement of which would lower the margin of the interest rate; ENEA would then allocate any savings from margin reductions to to non-governmental organizations (NGOs). In addition to the Poland Branch of BOC (Europe), the following lenders contributed to the loan syndicate: Polska Kasa Oszczędności Bank Polski S.A. (PKOP), Bank Gospodarstwa Krajowego (BGK), Bank Polska Kasa Opieki S.A., and Alior Bank S.A.. Bank Pekao served as coordinator and agent. The proceeds of Facility A were to be used by the borrower for the financing and refinancing of capital expenditures of ENEA incurred in connection with the construction, expansion, upgrade, and maintenance of the distribution network and the acquisition, development, expansion, financing, construction, upgrade, maintenance, and commissioning of any renewable energy sources. The proceeds of Facility B were to be used by the borrower to finance its day-to-day operations and working capital its group, except for the financing of the construction, acquisition or expansion of hard coal-fired power plants, other business related to hard coal, including hard coal mining and trading, and to refinance any financial debt or expenditures incurred for such purposes. As of December 31, 2023, the entire loan had been drawn down.