Automotive group Motus Holdings has secured a syndicated R6-billion sustainability-linked facility, facilitated by financial services firm Standard Bank, as well as an R800-million sustainability-linked working capital facility from Standard Bank.
This South African rand-denominated environmental, social and governance (ESG) facility will enable the next phase of Motus’ ESG journey. It will focus on the fuel used in group vehicles, the group’s water and electricity consumption, as well as gender equality to drive diversity and inclusion, the company said.
“Having secured international ESG-linked facilities in January 2020, the latest R6.8-billion reaffirms Motus’ ongoing commitment to ensure ESG principles and outcomes are integrated with its strategy and performance for sustained growth.
“We are pleased to be able to work with partners who have developed innovative products to integrate our sustainability values with responsible capital market participants. Our commitment to the targets recognises our ongoing investment and evolution to ensure that we reduce carbon emissions and contribute to social challenges to ensure a better and more sustainable business,” said Motus CEO Osman Arbee.
Sustainability-linked facilities tie the terms of funding to ESG outcomes to support and incentivise responsible corporate behaviour and the creation of shared value. As Motus achieves key performance indicators (KPIs), it receives an incentive in the form of a favourable interest rate benefit, and vice versa should it not achieve its KPIs.
“As we enter our seventy-fifth year of operations, our commitment to ESG practices and principles, will ensure we remain a sustainable and valuable contributor to our customers, employees, supply chain partners and the communities in which we operate,” said Arbee.
“Standard Bank is focused, primarily through its Sustainable Finance division, on providing financial products and services that support positive ESG outcomes, including green and social bonds, sustainability-linked loans and bonds, sustainable trade and working capital solutions and impact investing,” said Standard Bank South Africa CEO Lungisa Fuzile.
“Our partnership with Motus affirms our commitment to mobilise between R250-billion and R300-billion in sustainable finance by the end of 2026. We are, therefore, delighted and proud to partner with Motus in supporting their growth ambitions while also contributing to transformation in our economy,” he said.
POTENTIAL ACQUISITION
Motus has, meanwhile, also announced that it has issued a letter of intent for the potential acquisition of 100% of the shares in an aftermarket parts business for cash.
The offer, which is subject to certain conditions, is aligned to the strategic intent of Motus to expand its aftermarket parts operations in jurisdictions in which Motus operates.