ASX-listed operator Estia Health has refinanced its existing loans with a new $330m Sustainability Linked Syndicated Financing Agreement (SLSFA), which will reward it for achieving sustainability targets.
The new loan, which remains financed by Estia’s existing lenders ANZ, CBA, and Westpac, contains an extra $170 million in Accordion capacity for future growth.
Under the terms of the loan, Estia – which made $1 million in profit in FY2021 – will be rewarded via margin adjustments for achieving targets linked to greenhouse gas reduction; resident engagement and satisfaction; employee wellbeing; and improved environmental performance in line with NABERS Star Ratings.
Each target has been independently assessed by Ernst & Young against the Sustainability Linked Loan Principles, says Estia CFO Steve Lemlin.
“We are pleased to be one of the first residential aged care providers in Australia to execute a sustainability linked financing facility which clearly demonstrates our ESG commitment and accountability.
“The SLFA incentive structure is linked to our overall business and ESG strategies and will contribute to an overall lower overall cost of capital to support continuing investment in the sector,” he said.
Estia’s current sustainability strategy revolves around three pillars: “Supporting our People, Enhancing our Community and Respecting our Environment”.