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Zayo borrows $750m in first sustainability-linked loan

Matt Zayo CFO.jpg

Zayo has made what is its first loan linked to environmental, social and governance (ESG) standards.

The loan, of US$750 million, directly links Zayo’s cost of capital to achieving its greenhouse gas reduction targets and diversity initiatives.

CFO Matt Steinfort (pictured) said: “We are committed to long-term environmental sustainability, diversity, equity and inclusion. The ESG term loan aligns Zayo and its investors towards common goals that broadly benefit the environment and society.”

Zayo said this is the first ESG-linked term loan raised by a US bandwidth infrastructure company.

The company said that, as part of its broader ESG strategy, it will establish science-based targets that aim to reduce its annualized greenhouse gas emissions to achieve the long-term goal of net zero by 2030.

Zayo has already established long-term goals for diversity initiatives.

Steinfort said: “Funds from the loan will, in part, provide financing for Zayo’s transformational ESG efforts, including providing connectivity to more schools – which is ENA’s core business offering – and Zayo’s strategic efforts to reduce carbon emissions and improve diversity.”

Proceeds from the ESG term loan transaction will be used to drive continued organic growth, fund the recently announced acquisition of Education Networks of America, which provides managed network connectivity and security services to schools and other public sector customers, and other general corporate purposes.

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