The ASX 200 retailer announced a major sustainability-linked refinancing package.
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The Coles Group Ltd (ASX: COL) share price is slipping in afternoon trade, down 1.78% to $17.935 per share.
At the same time the S&P/ASX 200 Index (ASX: XJO) is edging higher, up 0.2%.
Below, we take a look at the ASX 200 retailer’s refinancing announcement.
What refinancing package did Coles report?
In an ASX announcement today, which may not be directly impacting Coles’ share price, the company said it has replaced existing debt facilities with a total of $1.3 billion, 4-year Sustainability Linked Loans (SLL) under its bilateral debt facilities.
Coles has previously stated it is working to become Australia’s most sustainable supermarket. In line with that, it said the new $1.3 billion SLL “draws a direct line” between its sustainability performance and its cost of capital.
The SLL is intended to increase transparency and accountability around environmental, social and governance (ESG) matters.
Coles’ focus is on reducing CO2 emissions, decreasing the amount of waste that goes to landfill, and increasing the representation of women in its leadership positions.
Commenting on the SLL refinancing, Coles’ chief financial officer Leah Weckert said:
Coles believes that sustainable businesses are better businesses, and our Sustainability Linked Loans reflect our commitment to working with all our stakeholders to make positive changes.
The SLL incentive structure is linked to our progress against company-wide sustainability goals with delivery of those goals delivering improved cost of capital, and is therefore an effective tool for driving sustainability throughout our business.
Australia and New Zealand Banking Group Ltd (ASX: ANZ), BNP Paribas and Rabobank acted as sustainability coordinators for the transaction.
Coles share price snapshot
The Coles share price is down 1.38% year-to-date, compared to a gain of 12.5% posted by the ASX 200. Coles shares are still recovering from a 15% fall in the latter weeks of February, following the release of its half-year financial results that appeared to disappoint investors.
Over the past month, Coles’ share price is up 1.6%.
Coles pays a 3.2% annual dividend yield, fully franked.
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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended COLESGROUP DEF SET. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.