Etihad Abu Dhabi works on third sustainable financing
DUBAI, Sept.29 (Reuters) – Etihad Airways is working on what would be its third financing transaction linked to sustainable investment considerations, the treasurer of the Abu Dhabi state-owned airline said on Wednesday.
Environmental, Social and Governance (ESG) concerns are gaining ground in the oil-rich Gulf region, with borrowers putting in place ESG frameworks to move to greener economies and take advantage of global awareness of risks sustainability following the COVID-19 pandemic.
“We are now working on what would be our third transaction in space,” said Daniel Tromans, treasurer of the Etihad group on Wednesday, without revealing any details other than to say that announcements could be made in the coming weeks.
He was speaking to a panel on sustainability at the ACT Middle East Treasury Summit, an online event.
Etihad set up a sustainable development financing framework in 2019, under which it raised 100 million euros ($ 117.14 million) to help finance the expansion of “Etihad Eco-Residence”, a sustainable apartment complex for cabin crew.
It also has a transition finance framework through which it can raise funds through bridging bonds, sukuk or loans, either through public transactions or private placements.
The proceeds from debt sales in this context are eligible to finance investments in new generation aircraft to replace the old fleet and for research and development of sustainable aviation fuels.
The airline is committed to net zero carbon emissions by 2050.
Etihad last year raised $ 600 million through “bridging” sukuk, or Islamic bonds, intended to help companies gradually transition to more environmentally friendly operations. (Reporting by Davide Barbuscia; editing by Barbara Lewis)