Gunvor Group launches new US$540 million biodiesel borrowing base
Switzerland-headed independent commodities trading house Gunvor Group (Gunvor) has announced that it has successfully closed a new US$540 million borrowing base facility to support the Group's biodiesel trading activity.
According to a statement, the facility drew “strong support” among Gunvor’s banking partners, which align with its strategy to promote cleaner products with greener feedstock components complying with EU climate targets to reduce greenhouse gas (GHG) emissions. The syndication launched at US$400 million and was oversubscribed to US$595 million.
Gunvor’s Biofuel trading desk has been active since 2009 and is involved in the entire supply chain of carbon reduction in the fuel sector, including risk management and logistics.
The facility is structured around Gunvor’s biofuel inventory positions located at both the origin and destination countries, including Gunvor’s two biofuel processing plants in Spain. Imports are made in strict conformity with the EU regulation applicable to biofuel products.
Growing biofuel activity
The facility’s pricing is competitive and reinforces the Group’s funding resources with its growing biofuel activity.
Biofuels, along with other ‘transitional’ commodities, are increasingly important to Gunvor’s trading mix. Our banking partners have expressed considerable support for trading cleaner products as Gunvor pursues its Energy Transition strategy, said Muriel Schwab, CFO Gunvor Group.
On a global basis, Gunvor sources a variety of feedstocks for the biofuel industry, such as vegetable oil, waste residues, and by-products, and then processes them in the Company’s own facilities to produce low carbon dioxide (CO2) emitting biofuels.
Gunvor operates several blending facilities in Asia, the United States (US), and throughout Europe, where the company prepares biofuels for end-consumers across the world. Gunvor also trades CO2 tickets to complement the CO2 reduction strategy of the company. Gunvor maintains two wholly-owned biodiesel plants in Spain.
At the end of the first half of 2020, approximately 50 percent of Gunvor’s total trading volumes consisted of “transitional” commodities, including biofuels, natural gas, and LNG, as currently defined by the EU taxonomy proposal for sustainable activities.
The Bookrunners for the deal were Credit Agricole and Rabobank, which served respectively as Documentary Agent and Facility / Security Agent. Participating banks also included: CA Indosuez (Switzerland) SA, Coöperatieve Rabobank UA, Citibank N.A, Unicredit Bank AG, Mizuho Bank Europe N.V, UBS Switzerland AG, Société Générale, and Sumitomo Mitsui Trust Bank Ltd (London Branch).
About Gunvor Group
Switzerland-headed Gunvor Group is one of the world’s largest independent commodities trading houses by turnover, creating logistics solutions that safely and efficiently move physical energy from where it is sourced to where it is are demanded most. With strategic investments in industrial infrastructure—refineries, pipelines, storage, and terminals—Gunvor further generates sustainable value across the global supply chain for its customers.
In 2019, Gunvor Group generated US$75 billion in revenue on 198 million tonnes of volumes. The Group’s main trading offices are in Geneva, Singapore, Houston, and London, with a network of more than 20 representatives and other trading offices around the globe.