SK Nexilis debuts green loan for manufacturing
KUALA LUMPUR: SK Nexilis Co Ltd, the world’s largest copper foil producer, announced the establishment of its Malaysian subsidiary’s (SK Nexilis Malaysia Sdn Bhd) first green syndicated term loan facility (green loan) in Malaysia.
In a joint statement with OCBC Bank (Malaysia) Bhd, which is acting as the green loan structuring adviser, SK Nexilis said the green loan aims to finance the construction cost of its first overseas copper foil manufacturing facility in Kota Kinabalu Industrial Park, Sabah, which is valued at RM2.3 billion.
The facility has an annual production capacity of 50,000 tonnes which will increase SK Nexilis’ global production capacity by two times, the statement said.
The copper foils produced will be exclusively used in electric vehicle batteries enabling sustainable, low-carbon mobility solutions in various locations including South Korea, Malaysia, Poland and North America.
SK Nexilis chief executive officer Shin Dong Hwan said the loan is the culmination of the company’s efforts and relentless commitment towards environmental, social and governance (ESG), as demonstrated by its net zero and RE100 initiatives, as well as the overwhelming support from the Malaysian government.
“Our new manufacturing facility will not only facilitate the decarbonisation initiative but also create job opportunities for the local talent network and provide traction for more investments to enhance the local supply chain development for electric vehicles,” he said.
According to the statement, OCBC Bank has played a pivotal role in structuring the green loan and advising on the underlying green financing framework to adapt to the company’s ESG objectives.
The bank also acted as mandated lead arranger, facility and security agent, and joint lender, alongside AmInvestment Bank Bhd as mandated lead arranger and AmBank (M) Bhd as the joint lender.
OCBC Bank managing director Tan Ai Chin said as a major electrical and electronics hub, Malaysia is well-positioned to develop a thriving local electric vehicle manufacturing base and ecosystem.
“We applaud SK Nexilis for the management’s foresight which places innovation and ESG at the core of its vision.
“OCBC Bank has also been at the forefront of the ESG agenda,” she said.
SK Nexilis also appointed Moody’s to issue a second party opinion report which certifies the loan’s framework to comply with its loan principles.
The transaction reaffirms SK Nexilis’ commitment to sustainability and is aligned with the overarching sustainability objectives of its parent company, SKC Ltd, which is part of SK Group, one of the largest conglomerates in South Korea.
SKC Co Ltd earlier unveiled a group-wide initiative to achieve net zero by 2040 and RE100, which is an initiative to transition to 100 per cent renewable energy utilisation in its operations, by 2050.
Our new manufacturing facility will not only facilitate the decarbonisation initiative but also create job opportunities for the local talent network and provide traction for more investments to enhance the local supply chain development for electric vehicles.
Shin Dong Hwan