Bahrain's Bapco Energies wins global awards for $2.2bln green credit facility

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Bahrain's Bapco Energies (formerly nogaholding) announced that it has received two international awards in recognition for its $2.2 billion sustainability-linked corporate financing facility and contributions to both ESG and the Islamic finance sector.

The company was awarded the Best Islamic Finance Facility Award at the 15th edition of the EMEA Annual Achievement Awards 2022 and ESG Loan Deal of the Year by the GFC Media Group at their annual Bonds, Loans & Sukuk Middle East Awards.

The awards follow Bapco Energies successful refinancing of its $1.6 billion Murabaha Facility and upsizing it to $2.2 billion. The new facility, a first of its kind for Bapco Energies and the largest in sustainability-linked finance in Bahrain, was structured as a dual-tranche (conventional and Islamic) sustainability-linked loan.

The transaction demonstrated high investor confidence in Bapco Energies credit and sustainability storey, with interest from international, regional, and local banks leading to an oversubscription of more than two times.

The awards demonstrate the great potential for ethical ESG and sustainability-driven transactions and continued growth in sustainable funding across the Kingdom of Bahrain and the region.

Lauding the company’s dual achievement, Bapco Energies Group CEO Mark Thomas said: "We are deeply honoured to have been awarded the Best Islamic Finance Facility and ESG Loan Deal of the Year. These two accolades are a testament to the confidence in our strategy and the growth seen across the company."

"Bapco Energies continues to drive forward by adopting the best practices across sustainable financing, aligning with the Kingdom’s Sustainable Development Goals (SDGs) and Bahrain’s Economic Vision 2030," he noted.

The dual-tranche (conventional and Islamic) sustainability-linked loan was based on a Secured Overnight Financing Rate (SOFR) with a maturity date of September 2026.

Gulf International Bank (GIB) and Mashreq Bank together acted as the Initial Mandated Lead Arrangers and Bookrunners (IMLABs) for arranging the facility, along with being the Sustainability Coordinators.

Al Ahli Bank of Kuwait – DIFC Branch, GIB, and Mashreq together acted as Joint Coordinators, the Initial Mandated Lead Arrangers, and Underwriters for the transaction. GIB was also appointed as the Sole Structuring Bank and the Global Facility Agent.

The bookrunners were Mashreq and GIB, while Linklaters acted as the legal advisor to the borrower and Norton Rose Fulbright served as the Legal Adviser to the JLMs.

Gulf International Bank CEO Jamal Al Kishi said: "GIB is proud to have used our expertise in sustainable financing to support Bapco Energies on this landmark transaction and its ongoing efforts to contribute to the realization of Bahrain’s energy transition goals."

"GIB is deeply committed to taking a leadership role in helping our clients utilize innovative instruments that allow them to transact and operate in a more sustainable way. The success and uptake for this loan attests to the strong appetite from investors for such instruments and underscores market confidence in Bapco Energies vision and strategy for a more sustainable energy future," he added.

Mashreq Group CEO Ahmed Abdelaal expressed delight at having the privilege of collaborating with Bapco Energies on their groundbreaking ESG landmark transaction.

"Being recognized in two leading international awards reflects Bapco Energies key role in driving energy transition across the region. As a leading regional financial institution with a global footprint, Mashreq is committed to actively supporting Bapco Energies and contributing to the sustainable development of the region's energy sector," noted Abdelaal.

"This facility not only highlights Bahrain's dedication to advancing the broader framework of decarbonization and energy transition but also signifies the increasing commitment of regional investors and financial institutions to finance Sustainability-Linked transactions," said Abdelaal.

"We firmly believe that collaboration among financial institutions, governments, and energy stakeholders is paramount to addressing the financing challenges posed by the energy transition in the region," he added.

Rami El Rifai, General Manager and Senior Executive Officer at Al Ahli Bank of Kuwait (DIFC branch), said: "We are incredibly honored to have had the opportunity to convey our commitment to Bahrain and support its journey to a sustainable future."

"These awards serve as a validation and affirmation of our dedication to ESG initiatives and our efforts toward an environmentally friendly future," he added.