Electrica secures 3.1 billion RON in green-focused syndicated loan

BUCHAREST - Romanian electricity company Electrica has announced on Thursday the signing of a 3.1 billion RON syndicated loan agreement, marking a significant move towards financing its green energy projects and infrastructure investments. Coordinated by Banca Transilvania and Banca Comercială Română as Mandated Lead Arrangers, the loan also involves Raiffeisen Bank as the Sustainability Agent.

The loan, approved by the Extraordinary General Meeting of Shareholders on November 8, 2024, is structured into four credit facilities aimed at refinancing existing debts and supporting Electrica’s investment plans. These plans include the development of renewable energy production, particularly in solar and wind energy, and the financing of the company’s 2025-2027 CAPEX plan for its electricity distribution subsidiary.

Alexandru Chiriță, CEO of Electrica, emphasized the loan’s role in strengthening the company’s financial structure and supporting strategic green investments, aiming to solidify Electrica’s position as a leader in sustainability and creating value for shareholders and investors.

The loan is expected to optimize Electrica’s financing by reducing short-term debt and improving financial performance, leading to greater stability and predictability in cash flows and EBITDA. This financial restructuring is seen as crucial for the company’s long-term planning and investment capabilities.

Ștefan Frangulea, Electrica’s Chief Financial Officer, highlighted the flexibility provided by the syndicated loan for managing working capital and financing long-term investments. He also acknowledged the collaborative effort of the banks involved in facilitating the development and implementation of renewable energy projects.

Representatives from Banca Transilvania and Banca Comercială Română expressed their commitment to supporting Electrica’s growth and the development of Romania’s energy infrastructure. The syndicate also includes other lenders such as BRD - Groupe Société Générale (EPA:SOGN), CEC Bank, ING Bank, and Intesa Sanpaolo (OTC:ISNPY) Bank Romania.

Legal assistance for the transaction was provided by Radu Tărăcilă Pădurari Retevoescu SCA and Dentons, with the sustainability component structured with Raiffeisen Bank’s support.

This strategic financial move is based on a press release statement and reflects Electrica’s focus on sustainable development and its aim to enhance shareholder value through strategic investments in Romania’s energy sector.

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