Indonesia - HHP Law Firm Advised BNP Paribas And ADM Capital On Asia’s First Sustainability Bond.
Legal News & Analysis - Asia Pacific - Indonesia - Capital Markets
20 April, 2018
Hadiputranto, Hadinoto & Partners (HHP Law Firm), member firm of Baker McKenzie in Indonesia, has advised BNP Paribas (“BNPP”) and ADM Capital on the structuring, formation and successful closing of the USD95 million Sustainability Bond, which will help finance a sustainable natural rubber plantation on heavily degraded land in two provinces in Indonesia. This transaction is the first corporate sustainability bond in Asia and the first sustainability bond in ASEAN.
The multi-tranche Sustainability Bond arranged by BNPP is issued by TLFF I Pte Ltd, with the proceeds being on-lent to PT Royal Lestari Utama (“RLU”) and its subsidiaries, an Indonesian joint venture between France’s Michelin and PT Satria Cemerlang (an associated company of Indonesia’s Barito Pacific Group), for the climate-smart, wildlife-friendly, socially inclusive production of natural rubber in Jambi and East Kalimantan provinces. The loan to RLU will be managed by ADM Capital and is partially guaranteed by the U.S. Agency for International Development (USAID). The project also involves a collaboration with the World Wildlife Fund, which has worked with Michelin and RLU to set aside remaining High Carbon Stock (HCS) and High Carbon Value (HCV) forest in the RLU concessions, as well as critical wildlife conservation and riparian areas.
Led by Norman Bissett, the HHP team advised BNPP and ADM Capital on due diligence and structuring matters, reviewing agreements from an Indonesian law perspective, as well as assisting with the preparation of the information prospectus and closing.
“We are delighted to have assisted BNPP and ADM Capital on this landmark transaction. As sustainability is increasingly moving up the agenda, both for banks and international and regional corporates, we hope to see more deals of this nature,” Norman Bissett said.
According to Vigeo Eiris, the Environmental, Social Governance (“ESG”) research agency, the Notes are ’Sustainability Notes’ which have a positive contribution to sustainable development, and are aligned with the ICMA Sustainability Bond Guidelines.
Linklaters Hong Kong and Linklaters Singapore Pte Ltd acted as international counsel on this transaction for BNP / ADM Capital; RLU was represented by AHP, Jakarta.