UAE’s Majid Al Futtaim secures $1.5bn sustainability-linked loan

UAE’s Majid Al Futtaim has signed its inaugural $1.5bn (Dhs5.51bn) sustainability-linked loan (SLL).

The five-year loan is structured as a revolving credit facility (RCF) and is the largest corporate, non-government-linked SLL in the region and the largest in the MENA real estate sector.

The company’s agreement also includes a gender diversity target for women to constitute 30 per cent of board members and senior management roles, a statement said.

Ziad Chalhoub, chief financial officer, Majid Al Futtaim Holding, said: “Majid Al Futtaim continually strives to become one of the most sustainably considerate companies in the world, and this extends to genuine accountability in how we finance our operational and capital expenditures across the group. The signing of our first sustainability-linked loan comes as a result of, and in line with, our long-term strategic targets, including the production of more energy and water than we consume, reaching a Net Positive business model by 2040.

“While a company’s profitability is important, how you contribute to sustainability is becoming more crucial and a filter for investors to decide how much and where they will invest. To ensure that you have access to funding – and at attractive rates – in a world where sustainability is becoming more important, it is imperative to embrace this reality now and not be left behind.”

Via the facility, the company aims to have all its malls certified LEED Gold or better. Majid Al Futtaim Properties’ hotels were the region’s first to receive LEED Platinum certification across its 13-hotel property portfolio earlier this year.

Mohamed Salama, regional head of client coverage MENA, Standard Chartered Bank, said: “We are delighted to support Majid Al Futtaim in their landmark debut sustainability linked loan by acting as sole sustainability coordinator. Having structured the first-ever loan in the Middle East to incorporate sustainability-linked pricing in 2018, we are proud to have brought another pioneering facility to the market.”

The conglomerate has been stepping up its sustainability agenda. Last year, it opened what it claimed as Dubai’s first in-store hydroponic farm at its Carrefour market Al Wasl store.

Read: Majid Al Futtaim launches Dubai’s ‘first’ in-store hydroponic farm

In 2019, it announced that it would eliminate single-use plastic from its operations by 2025. As part of the decision, Carrefour stores will remove 800 million plastic grocery bags from circulation annually, it had stated.

Read more: UAE Carrefour stores to soon remove plastic bags as part of Majid Al Futtaim eco-plan