Cabot Closes $1 Billion Credit Facility with Pricing Tied to Emissions Performance
Chemicals and performance materials company Cabot Corporation announced that it has entered into a $1 billion revolving credit facility, with pricing tied to the company’s performance against its emissions reduction targets.
Sustainability-linked securities are an emerging form of sustainable finance instruments, with attributes including interest payments tied to an issuer’s achievement of specific sustainability targets. The pricing for Cabot’s new credit facility is based on the company’s credit ratings as well as its performance against its targets to reduce NOX emissions intensity by 50% and SO2 emissions intensity by 40% by 2025.
Sean D. Keohane, President and CEO, said:
“Cabot has a long history of leadership and innovation in the chemical industry. Consistent with this leadership is our commitment to sustainability, acting responsibly for the planet and being a good corporate citizen. We are excited to deepen this commitment by being among the first major chemical companies in the U.S. to secure a sustainability-linked facility that rewards our continued efforts in reducing our SO2 and NOX emissions.”
Cabot stated that the deal marks one of the first sustainability-linked revolving credit agreements in the U.S. chemical industry.
Martin O’Neil, Senior Vice President, Safety, Health and Environment (SH&E), added:
“Incorporating this important sustainability goal into our Credit Agreement directly aligns with the commitments we have made to our stakeholders under our ambitious 2025 sustainability goals. “Transparency remains a cornerstone of our sustainability agenda, and we continue to extend that commitment by enhancing our sustainability reporting and disclosures. We are proud of the progress we are making in our sustainability initiatives, and we look forward to working with our various stakeholders to achieve our goals.”