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Bahrain Steel lands $450m loan for green transition

Banking and Bahrain Steel executives at the loan signing ceremony. The $450m will be used to build the world’s largest stockyard shed with rooftop solar panels Mashreq
Banking and Bahrain Steel executives at the loan signing ceremony. The $450m will be used to build the world’s largest stockyard shed with rooftop solar panels

Bahrain Steel, a supplier of high-grade iron ore pellets, has secured a $450 million sustainability-linked loan from a consortium of regional banks as part of its carbon footprint reduction drive.

The loan will be used to build the world’s largest stockyard shed with rooftop solar panels, in addition to meeting working capital requirements, Dubai-headquartered lender Mashreq said in a statement.

The facility will be tracked against a set of relevant key performance indicators and sustainable performance targets throughout its seven-year tenure.

The loan framework incentivises Bahrain Steel to exceed mandatory greenhouse gas emissions reductions, facilitating the company’s transition toward lower carbon operations.

In addition, the company will benefit from the roll out of an adoption programme focused on climate change and environmental risks. Details of the incentives were not disclosed.

“This strategic financing enables us to accelerate our efforts toward significant carbon footprint reduction and reinforces our commitment to sustainable practices in the steel industry,” said Meshary Al-Judaimi, chairman of Bahrain Steel.

Bank ABC served as the facility and security agent, and account bank, while Ahli United Bank was the murabaha investment agent.

Bank ABC, Emirates NBD, and Mashreq jointly acted as mandated lead arrangers.

Arab Bank, Ahli United Bank, Gulf Bank, Kuwait Finance House and Khaleeji Bank worked as joint lead arrangers.

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