HomeBusinessSouth Africa’s First ZAR-based Automotive Sector Syndicated Sustainability-Linked Facility

South Africa’s First ZAR-based Automotive Sector Syndicated Sustainability-Linked Facility

Standard Bank has successfully led the arrangement of a ZAR 6 billion sustainability-linked term facility and a ZAR 800 million sustainability-linked working capital facility for Motus, the first ZAR-based sustainability-linked funding in the South African automotive sector.

As a leading automotive group, with an unrivalled scale and scope in South Africa, the ZAR 6.8 billion funding package highlights the importance of Motus’ environmental, social and governance (ESG) journey.

“Through our close client engagement, Standard Bank was able to partner with Motus in creating a financing solution that supports the continued growth ambitions of the business while also aligning with its ESG commitments,” says Anneke Lund, Sustainable Finance Executive at Standard Bank Group. “Our role as mandated lead arranger, bookrunner and sustainability coordinator brought market participants together to successfully syndicate its first ZAR-based sustainability-linked funding in South Africa.”

Sustainability-linked loans tie the terms of funding to ESG outcomes to support and incentivise responsible corporate behaviour and the creation of shared value. As Motus achieves its key performance indicators (KPIs), it receives an incentive in the form of a favourable rate benefit and vice versa should it not achieve its KPIs.

This drives Motus’ environmental and social impact through material KPI selection and setting ambitious targets, with a focus on its own road fuel consumption, water consumption, electricity efficiency and gender equality to drive diversity and inclusion.

“ESG performance is both a financial and ethical priority. Companies that operate in a sustainable manner tend to have lower risk profiles and outperform those that don’t over the long-term. For this reason, demand continues to grow for sustainability-linked financing that can offer clients the opportunity to narrow down the focus on its environmental impact strategy and to deliver socio-economic impact,” says Lund.

Standard Bank is focused, primarily through its Sustainable Finance division, on providing financial products and services that support positive ESG outcomes, including green and social bonds, sustainability-linked loans and bonds, sustainable trade and working capital solutions and impact investing.

“Our partnership with Motus affirms our commitment to mobilise between R250 billion and R300 billion in sustainable finance by the end of 2026. We are therefore delighted and proud to partner with Motus in supporting its growth ambitions while also contributing to transformation in our economy,” says Lungisa Fuzile, CEO of Standard Bank South Africa.

“Partnerships remain vital in not only providing access to financing for our expansion plans, but also in leveraging our extensive reach, experience and insight into the African market’s social, economic and regulatory landscape,” says Osman Arbee, CEO of Motus. “As we enter our 75th year of operations, our commitment to ESG practices and principles, will ensure we remain a sustainable and valuable contributor to our customers, employees, supply chain partners and the communities in which we operate.”

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