Emirates Global Aluminium used 'green' loans to fund German foundry purchase
EGA uses its first green loan to acquire German foundry; issues new finance framework
Dubai: The UAE industrial giant Emirates Global Aluminium fully funded its recent acquisition of a foundry in Europe through its first green loan facility.
EGA had completed the acquisition of Leichtmetall last month. The European mill uses renewable energy to produce up to 30,000 tonnes per year of aluminium billets at its plant in Germany, with secondary aluminium comprising some 80 per cent of the input material.
Global demand for aluminium is expected to grow between 50-80 per cent by 2050. “Recycled and low-carbon primary aluminium are expected to account for around 60 per cent of supply growth between now and 2030, and around 70 per cent of supply growth between 2030-40,” EGA said in a statement.
The UAE company has now brought out its ‘Green Finance Framework’, which sets it up to deploy more such financing for its future requirements.
The framework will support ‘decarbonisation projects and initiatives that contribute to the transition to a low-carbon economy’.
A green finance framework defines the eligibility and governance mechanisms for financing from third-party institutions and funds that ‘prioritise sustainability in their capital allocation’.
“Publishing the framework advances EGA’s sustainability goals by enabling access to a more diverse range of funding options for loans and bonds,” said the statement. And ‘potentially lowering the cost of borrowing while ensuring increased transparency’.