Britvic announces first sustainability-linked financing deal

Britvic has agreed its first sustainability-linked credit facility, allowing it to borrow up to £400 million over the next five years whilst linking the margin of the facility to its sustainability goals.

The five-year facility, which can be extended by a further two years, was coordinated by Rabobank and has been provided by a group of seven leaders.

The facility is linked to the progress Britvic makes against three sustainability targets, and the better Britvic performs against the targets, the further the margin will reduce.

The sustainability targets include 50 per cent of all Britvic’s plastic bottles in Great Britain and Ireland being made of recycled plastic, a 50 per cent reduction in carbon emissions compared to 2017, and 75 per cent of its drinks portfolio globally to either be low or no sugar.

In what is one of the first agreements of its kind in the UK, Britvic or the lenders will donate the proceeds from any change in margin to charitable causes.

Sarah Webster, Sustainability Director at Britvic, said: “This financing agreement is part of our commitment to embed sustainability at the heart of our business and drive real behaviour change.”

“We’ve made progress against our sustainability ambitious, however there’s more to do and this is a significant commercial milestone in our journey.”

“By linking financing to our goals, we can ensure that every penny we invest is done so with our sustainability targets in mind.”

Alastair Cameron, from Rabobank’s London-based loan syndications team, said: “Sustainability-linked financing has been a growing trend for several years but this facility, which will see Britvic donate the discount proceeds to charity, is one of the first of its kind in the UK market.”

“Sustainability was the key theme of last year and it will continue to dominate the agenda in 2020. Linking funding to metrics like developing a healthier product portfolio and recycling more plastic packaging is one way corporates like Britvic can continue to show leadership to make business more responsible and sustainable.”