MUFG is pleased to announce the financial close of the first structured green bus financing for Transdev.
This achievement is a significant milestone and commitment by Transdev on its journey to reducing carbon emissions across its fleets and it represents one of the first structured finance green bus transactions in Europe. The SEK 1.2 billion financing facilitates the acquisition of 297 electric and biofuel buses being leased to Transdev for its buses on five concessions in Gothenburg starting from December 2020.
In March 2019, Transdev won five 10-year contracts to operate bus services from December 2020 in Gothenburg, Sweden's second largest city. The commissioning of the green bus fleet, running exclusively on electricity from renewable energies or on biofuels, supports the city of Gothenburg in reaching its goal of turning all city transport to electric by 2030.
MUFG Bank and Société Générale acted as Co-Arrangers, Lenders, Hedge Counterparty and Joint Green Structuring Advisor to Transdev. In addition, Société Generale acted as Lease Arranger, Agent and VAT Facility Provider. MUFG and Société Générale also assisted Transdev in achieving the first green leasing transaction for the wider Transdev Group and set-up a green loan framework in line with the Loan Market Association's Green Loan Principles.
Robert Bartlett, Head of Infrastructure for MUFG EMEA, said:
"It was a privilege to support Transdev with this transaction as they lead the way toward a more sustainable future. From being a first in Europe to the green element, this milestone deal really highlights MUFG's strengths in delivering innovative solutions for clients across EMEA.
"Backed by our rail and wider transport experience, green buses will clearly become an important area for MUFG alongside our broad range of initiatives to support the energy transition."
About 770,000 buses were in use in the European Union and the UK in 2019. 99% of those buses operated based on fossil fuels. Transitioning to low carbon public transport means there will be a significant need for financing and MUFG is proud to be playing a role in this momentous shift to a sustainable low carbon economy.
Marcos Garcia, CFO of Transdev Group, said:
"At Transdev, we are very pleased to achieve our first green financing with MUFG. Transdev is today Europe's frontrunner public transport operator in terms of zero emission bus fleets in terms of bidding, implementation and operation, with more than 1,100 zero-emission vehicles in operation at the end of 2020, including those to be operated for the new Gothenburg concession.
"With innovative financing schemes, we are well-placed to tackle the challenge of energy transition - where Capex and Opex models are heavily impacted - and therefore bring the best value for money to our Public Transit Authorities."
Norton Rose Fulbright Paris and law firm Hammarskiöld advised the two Co-Arrangers and the Lessor on the transaction. The law firm De Gaulle Fleurance & Associés advised Transdev. KPMG AB assisted the lenders with regard to value-added tax matters in Sweden.
To find out more on Zero-Emission Buses in Europe, read the latest in our Low Carbon Finance Series.