Bank of America, the sole underwriter of the entire loan, has provided $50 million, and the Cincinnati, Ohio-based Fifth Third Bank paid $30 million, the company said.

In the industry’s first, pharmaceutical company Glenmark has raised $228 million in a sustainability-linked loan (SLL) from a consortium of foreign lenders led by Bank of America.

Bank of America, the sole underwriter of the entire loan, has provided $50 million, and the Cincinnati, Ohio-based Fifth Third Bank paid $30 million, the company said.

“We raised a USD 228 million SLL in the ECB (external commercial lending) category at a significantly reduced cost to refinance its existing ECB debt. We believe this is the first SLL loan from a domestic pharmaceutical company,” Glenmark Executive Director and Chief Financial Officer VS Mani told PTI on Tuesday.

The price of the five-year bond is 175 basis points (bps) above the London interbank offered rate, or Libor, which is replaced by the SOFR, or the secured overnight financing rate.

The SOFR is the benchmark interest rate for dollar-denominated derivatives and loans that replaces the scam-plagued Libor.

The interest margin will fall by 2.5 basis points if the borrower meets both sustainability metrics related to emissions reduction and water use, the Bank of America explained.

Glenmark will use the fund to refinance a $182.5 million syndicated loan that closed in November 2020, Mani added.

The other lenders in the consortium include leading Taiwanese lender CTBC Bank, Emirates NBD and Qatar National Bank Singapore branch, each of which donated $24 million. While Mashreq Bank and Japan’s MUFG and Siemens Bank Singapore branches expanded $20 million.

ING Bank and KEB Hana Bank Bahrain branch raised $8 million each.

This post Glenmark raises its first USD 228 million sustainability-related loan

was original published at “https://www.financialexpress.com/healthcare/pharma-healthcare/glenmark-raises-industrys-first-sustainability-linked-loan-of-usd-228-million/2468179/”