Shearman And Sterling

News March 05, 2019

First-of-Its-Kind Sustainability-Linked Revolving Credit Facility for Xylem Inc.

Shearman & Sterling advised Citibank, N.A, as administrative agent on an $800 million five-year senior unsecured revolving credit facility for Xylem Inc., the proceeds of which will be used for general corporate purposes. This revolving credit facility, coupling interest rates with sustainability performance, is one of the first sustainable improvement loans in the U.S. and the first in the general industrial sector. The facility’s interest rate is index-linked to Xylem Inc.’s overall sustainability performance as rated by Sustainalytics, a leading independent global provider of environmental, social and corporate governance (ESG) ratings. Improvements in Xylem Inc.’s sustainability performance will reduce interest rates under the facility.

Sustainability-linked loans are loans that incentivize borrowers with margin reductions or increases depending on their ability to meet pre-set environmental performance targets.

Xylem Inc., headquartered in Rye Brook, New York, designs, manufactures and services engineered solutions for water and wastewater treatment.

The team