Covestro Signs €2.5 Billion Syndicated Revolving Credit Facility
LEVERKUSEN, Germany — Covestro has successfully signed a contract with its 16 core banks for a new syndicated revolving credit facility for €2.5 billion with a term of five years plus two one-year extension options, effective as of March 17, 2020. The facility can be drawn in different currencies and will be used as a standby backup liquidity reserve.
The new facility replaces the existing €1.5 billion revolving credit line, which was also a backup liquidity facility. It provides Covestro with additional financial flexibility and increased liquidity reserves on favorable terms.
One important new element of the facility is the link with an environmental, social and governance (ESG) rating: the better Covestro’s ESG performance is, the lower the interest component of the credit facility will be.
“We decided at the end of 2019 to increase our liquidity resources with a new €2.5 billion syndicated revolving credit facility, which is provided by all our core relationship banks. This facility ensures that we have considerable financial leeway over the next few years. By linking the interest on the facility to an ESG rating, we are embedding sustainability as a topical focus in all areas of our business and setting ourselves ambitious targets,” said CFO Dr. Thomas Toepfer.