MONTREAL, May 16, 2022 /CNW Telbec/ - SNC-Lavalin (TSX: SNC), a fully integrated professional services and project management company with offices around the world, today announces the closing of an agreement with its lenders to replace and extend its existing syndicated credit facilities. The replacement will result in reduced overall borrowing costs, with potential further reductions contingent upon SNC-Lavalin's achievement of certain environmental, social and governance (ESG) targets. 100% of the savings realized because of the Company's ESG results will be directed towards initiatives that further advance the Company's ESG strategy.
Pursuant to the agreement and upon closing, the revolving credit facility (the "Revolving Credit Facility"), is reduced from $2.6 billion to $2.0 billion and available for cash draws and issuances of letters of credit. The Revolving Credit Facility will be further reduced to $1.8 billion in April 2023. The term loan (the "Term Loan", and together with the Revolving Credit Facility, the "Credit Facilities") is unchanged at $500 million. The Credit Facilities have a maturity date of May 2025.
The Credit Facilities are being structured to incorporate a sustainability-linked loan framework, to align with SNC-Lavalin's leading ESG initiatives and resulting in borrowing savings upon achievement of certain sustainability performance targets. The relevant targets are aligned with the enhanced targets from our latest Sustainability Report: Our Vision for Engineering a Sustainable Society. These targets will be based on the achievement of:
"Bank lenders and capital markets are increasingly holding companies accountable on how effectively they integrate and deliver on their ESG objectives," commented Ian L. Edwards, President and Chief Executive Officer, SNC-Lavalin. "The renewed Credit Facilities allow us to realign our lending requirements to better meet the needs of our business following the introduction of our Pivoting to Growth Strategy and new operating structure, while simultaneously reducing our borrowing costs. By linking sustainability outcomes with our corporate financing strategy, we continue to demonstrate to our clients and various stakeholders that we are committed and accountable to the goals we've set and have fully operationalized our greater purpose?to engineer a better future for our planet and its people."
"Today, we've demonstrated what we already knew to be true; that an ambitious, transparent, and accountable ESG strategy is good for the business too," said Hentie Dirker, Chief ESG and Integrity Officer, SNC-Lavalin. "We've made a number of significant ESG commitments in the past few years, working collaboratively with internal and external stakeholders to identify the areas we can have maximum impact. Our ESG strategy shapes the way we do business outside our Company too; through initiatives like Engineering Net Zero, our Counterparty Code of Conduct for our suppliers, our Integrity program, and our standing as an Indigenous supplier procurement champion in Canada. Thanks to ambitious goals and laser-focused execution, we're well on our way to positioning SNC-Lavalin as a globally recognized leader in ESG."
SNC-Lavalin's broader ESG activities include the linkage of executive compensation to ESG-related hurdles, achieving 36% representation of women on the Board of Directors, the creation of dedicated global leadership roles for ESG as well as Equality, Diversity and Inclusion, and a Routemap to reach carbon net zero by 2030. SNC-Lavalin's internal carbon reduction targets are in addition to its Engineering Net Zero blueprint, to help clients reduce their carbon emissions, manage climate risk, and build climate resilience within their portfolios.
Bank of Montreal, HSBC Bank Canada, Royal Bank of Canada, BNP Paribas, Canadian Imperial Bank of Commerce, National Bank Financial Markets, The Bank of Nova Scotia and TD Securities acted as Joint Bookrunners and Co-Lead Arrangers on the Revolving Credit Facility. National Bank Financial Markets, Bank of Montreal and The Bank of Nova Scotia acted as Joint Bookrunners and Co-Lead Arrangers on the Term Facility. Bank of Montreal acted as Administrative Agent on the Credit Facilities and National Bank of Canada, HSBC Bank Canada and The Toronto-Dominion Bank acted as Co-Sustainability Structuring Agents.
Founded in 1911, SNC-Lavalin is a fully integrated professional services and project management company with offices around the world dedicated to engineering a better future for our planet and its people. We create sustainable solutions that connect people, technology and data to design, deliver and operate the most complex projects. We deploy global capabilities locally to our clients and deliver unique end-to-end services across the whole life cycle of an asset including consulting, advisory & environmental services, intelligent networks & cybersecurity, design & engineering, procurement, project & construction management, operations & maintenance, decommissioning and capital ? and delivered to clients in key strategic sectors such as Engineering Services, Nuclear, Operations & Maintenance and Capital. News and information are available at snclavalin.com or follow us on LinkedIn and Twitter.
Reference in this press release to the "Company" or to "SNC-Lavalin" means, as the context may require, SNC-Lavalin Group Inc. or all or some of its subsidiaries or joint arrangements or associates. Statements made in this press release that describe the Company's or management's expectations or strategies may be "forward-looking statements", which can be identified by the use of the conditional or forward-looking terminology such as "expects", "forecasts", "intends", "may", "objective", "plans", "projects", "should", "will", "likely", or the negative thereof or other variations thereon. Forward-looking statements also include any other statements that do not refer to historical facts. Forward-looking statements also include statements relating to the future capital expenditures. All such forward-looking statements are made pursuant to the "safe-harbour" provisions of applicable Canadian securities laws. The Company cautions that, by their nature, forward-looking statements involve risks and uncertainties, and that its actual actions and/or results could differ materially from those expressed or implied in such forward-looking statements, or could affect the extent to which a particular projection materializes. Forward-looking statements are presented for the purpose of assisting investors and others in understanding certain key elements of the Company's current objectives, strategic priorities, expectations and plans, and in obtaining a better understanding of the Company's business and anticipated operating environment. Readers are cautioned that such information may not be appropriate for other purposes. Forward-looking statements made in this press release are based on a number of assumptions believed by the Company to be reasonable as at the date hereof. The assumptions are set out throughout the Company's 2021 Annual MD&A (particularly in the sections entitled "Critical Accounting Judgments and Key Sources of Estimation Uncertainty" and "How We Analyze and Report our Results") filed with the securities regulatory authorities in Canada, available on SEDAR at www.sedar.com at and on the Company's website at www.snclavalin.com under the "Investors" section. If these assumptions are inaccurate, the Company's actual results could differ materially from those expressed or implied in such forward looking statements. In addition, important risk factors could cause the Company's assumptions and estimates to be inaccurate and actual results or events to differ materially from those expressed in or implied by these forward-looking statements. Those risks are identified in the Company's 2021 Annual MD&A (particularly in the sections entitled "Risk and Un certainties") and are not exhaustive. The forward-looking statements herein reflect the Company's expectations as at the date of this press release and are subject to change after this date. The Company does not undertake to update publicly or to revise any such forward-looking statements whether as a result of new information, future events or otherwise, unless required by applicable legislation or regulation.
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