Tata Steel in discussions for offshore green loan of up to $400M
- As per sources, no definite conclusion has been reached yet, and the particulars may still be altered.
India’s Tata Steel Ltd. is in talks to raise as much as $400 million, according to people familiar with the matter, in what could become the company’s first green loan.
The debt could have a tenor of about five years and the proceeds would be used for capital expenditure, said the people, who declined to be named because the matter is private. The lenders include Bank of America Corp., HSBC Holdings Plc, JPMorgan Chase & Co. and Mitsubishi UFJ Financial Group Inc.
As per sources, no definite conclusion has been reached yet, and the particulars may still be altered. Data compiled by Bloomberg suggest that this would be the first time that Tata Steel receives a green loan.
“While the company is continuously evaluating the developments and options in the green financing space, there is nothing concrete,” Tata Steel said in reply to queries by Bloomberg News. The steelmaker continues to focus on its deleveraging plan and further repayments beyond the $4.5 billion debt reduction achieved in the last three years, it said.
Steelmaking is carbon intensive and the sector will require fresh financing to improve its environmental footprint. A global shift to low-emissions productions would require outlays of about $4.4 trillion over the next 30 years, according to a 2022 McKinsey Quarterly report.
Tata Steel lags behind its peers on several environmental metrics, including greenhouse gas emissions, air quality, and water and waste management, according to a media report.
Following the reports, Tata Steel emerged as the top performer on the BSE as its stock surged by 2% at 9.42 am.
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First Published:19 Apr 2023, 07:08 AM IST
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