On 14 December 2020, Transdev announced its first SEK 1.2bn green bus structured financing transaction, aimed at providing the Swedish city of Gothenburg with low-carbon public transportation, arranged with Mitsubishi UFJ Financial Group (MUFG) and Societe Generale, supported by the European Investment Bank (EIB). This achievement is a significant milestone and commitment by Transdev on its journey to reducing carbon emissions across its fleets and it represents one of the first green bus structured finance transactions in Europe. The SEK 1.2bn financing operation facilitates the acquisition of 297 electric and biofuel buses being leased to Transdev for its use on five concessions in Gothenburg, starting from December 2020.
In March 2019, Transdev won five 10-year contracts to operate bus services as from December 2020 in Gothenburg, Sweden’s second-largest city. The commissioning of the green bus fleet, running exclusively on electricity from renewable energies or on biofuels, supports the city of Gothenburg in reaching its goal of switching all city transport to electric by 2030.
In order to provide Transdev with the best financing conditions, Societe Generale’s participation will be funded by the European Investment Bank (EIB). Through this deal, all three banks – the EIB, Societe Generale and MUFG – renew their cooperation and commitment to advance the sustainable energy transition of our societies.
The EIB, under its recently approved “Climate Bank Roadmap” will dedicate half of all its investments to the fight against climate change by 2025. Societe Generale has reiterated its target to help raise €120bn between 2019 and 2023 through a range of sustainable financing solutions (credit, bonds, advisory). By the end of September 2020, it had already achieved 60% of this target. In May 2019, MUFG announced its aim to provide a cumulative total of JPY 20tn (circa USD 189bn) in sustainable finance between 2019 and 2030 to help build a sustainable society and attain the UN’s Sustainable Development Goals through the provision of financial services to clients.
MUFG and Societe Generale also assisted Transdev in achieving the first green leasing transaction for the wider Transdev Group and set up a green loan framework in line with the Loan Market Association’s Green Loan Principles.
Robert Bartlett, Head of Infrastructure for MUFG EMEA, said: “It was a privilege to support Transdev with this transaction as they lead the way toward a more sustainable future. This milestone deal is a fantastic achievement for all parties involved and is a great example of how collaboration can lead to innovative solutions which truly benefit clients and the communities in which we operate. Backed by our rail and wider transport experience, green buses will clearly become an important area for MUFG alongside our broad range of initiatives to support the energy transition.”
Tanguy de Pompignan, Global Head of Structured Solutions & Leasing at Societe Generale, added: “We are very proud Transdev trusted Societe Generale’s expertise to support it on such a pivotal transaction for the future energy mix of its fleet. It is fully in line with the bank’s strategy and that of its trusted partners MUFG and EIB to facilitate its clients’ own energy transition and together build a more sustainable society.”
European Investment Bank Vice-President Thomas Östros commented: “It’s a pleasure to see how, together with Societe Generale, EIB financing is helping Gothenburg shift to low-carbon sustainable models of transportation. Our support in this facility helps both the environment and the Swedish economy. The EIB, as the EU’s climate bank, is happy to work alongside Societe Generale in achieving our ambitious climate action targets. Projects such as this one are important steps in getting us there.”
MUFG Bank and Societe Generale acted as Co-Arrangers, Lenders, Hedge Counterparty and Joint Green Structuring Advisor to Transdev. Societe Generale also acted as Lease Arranger and Agent.
Norton Rose Fulbright Paris and law firm Hammarskiöld advised the two Co-Arrangers and the Lessor on the transaction. The law firm De Gaulle Fleurance & Associés advised Transdev. KPMG AB assisted the lenders with regard to value-added tax matters in Sweden.
Societe Generale is one of the leading European financial services groups. Based on a diversified and integrated banking model, the Group combines financial strength and proven expertise in innovation with a strategy of sustainable growth, aiming to be a trusted partner for its clients, committed to the positive transformations of society and the economy.
Active in the real economy for over 150 years, with a solid position in Europe and connected to the rest of the world, Societe Generale has over 149 000 employees in 67 countries and supports on a daily basis 31 million individual clients, businesses and institutional investors around the world by offering a wide range of advisory services and tailored financial solutions. The Group is built on three complementary core businesses:
- French Retail Banking, which encompasses the Societe Generale, Crédit du Nord and Boursorama brands. Each offers a full range of financial services with omnichannel products at the cutting edge of digital innovation.
- International Retail Banking, Insurance and Financial Services to Corporates, with networks in Africa, Russia, Central and Eastern Europe and specialised businesses that are leaders in their markets.
- Global Banking and Investor Solutions, which offers recognised expertise, key international locations and integrated solutions
Societe Generale is included in the principal socially responsible investment indices: DJSI (World and Europe), FTSE4Good (Global and Europe), Euronext Vigeo (World, Europe and Eurozone), four of the STOXX ESG Leaders indices, and the MSCI Low Carbon Leaders Index.
Mitsubishi UFJ Financial Group, Inc. (MUFG) is one of the world’s leading financial groups. Headquartered in Tokyo and with over 360 years of history, MUFG has a global network with around 2 700 offices in more than 50 markets. The Group has over 180 000 employees, and offers services including commercial banking, trust banking, securities, credit cards, consumer finance, asset management, and leasing.
MUFG aims to be the world’s most trusted financial group through close collaboration among its operating companies, and to respond to all of the financial needs of its clients, serving society and fostering shared and sustainable growth for a better world.
MUFG’s shares trade on the Tokyo, Nagoya, and New York stock exchanges.
Source: MUFG and Societe Generale support clean urban transport in Gothenburg with EIB credit line
Photo Credit : https://pixabay.com/photos/göteborgtram-gothenburg-tram-2304870/