Zenith raises the UK vehicle leasing sector's largest green bond

31 / 01 / 22  |  In the Press

Zenith Automotive Holdings Limited (together with its subsidiaries, the “Zenith Group”) has announced that Zenith Finco Plc, its wholly-owned subsidiary, has closed its inaugural offering of £475,000,000 green senior secured fixed rate notes due 2027 (the “Notes” or the “Offering”).

In addition, Zenith Group has entered into a new £65.0 million revolving credit facility to replace its existing credit facility.

The proceeds from the transaction repaid in full the existing term facilities, and the remaining amounts will be used for general corporate purposes and to pay fees and expenses in connection with the refinancing.

Tim Buchan, Zenith Group chief executive officer, said:

“Our mission at Zenith has never been clearer – to eliminate tailpipe emissions from the UK vehicle parc. I am therefore delighted to raise this green bond.

“Sustainability is a key aspect of our strategy and we are always looking at how we can reduce our own impact on the environment. This green bond will enable Zenith to remain at the forefront of sourcing and financing electric vehicles to meet the record levels of demand from UK motorists for low-emission transport.”

Over the next two years, the Zenith Group intends to spend in excess of the equivalent of the gross proceeds from the Notes on financing or refinancing eligible green projects, including battery electric vehicles across its three divisions, in accordance with its Green Financing Framework, which has been assessed by Sustainalytics.

The transaction is indicative of Zenith’s broader strategic goals in driving the take up of electric vehicles and helping to decarbonise the UK vehicle parc. Zenith is one of the largest purchasers of electric vehicles in the UK.

Currently, EVs make up over 50% of the order book in Zenith’s corporate division indicating strong demand in this area. ZenAuto, the business’ direct-to-consumer segment, is also experiencing strong consumer demand for EVs.

Zenith is itself a carbon neutral company and a market leader in its commitments to lower emissions.

More information about Zenith’s Green Financing Framework and the Sustainalytics review is available on our website here: https://www.zenith.co.uk/results-policies/#green-finance

Cautionary Statement
This announcement does not constitute an offer to sell or the solicitation of an offer to buy the Notes or any other security and shall not constitute an offer, solicitation or sale in the United States or in any jurisdiction in which, or to any persons to whom, such offering, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any jurisdiction.

The Notes have not been, and will not be, registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”) or the securities laws of any state or other jurisdiction of the United States, and may not be offered or sold within the United States, or to, or for the account or benefit of, U.S. persons, except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state or local securities laws. Accordingly, the Notes are being offered and sold in the United States only to qualified institutional buyers in accordance with Rule 144A under the Securities Act and to persons who are outside of the United States in offshore transactions in accordance with Regulation S under the Securities Act.

Promotion of the Notes in the United Kingdom is restricted by the Financial Services and Markets Act 2000 (the “FSMA”), and accordingly, the Notes are not being promoted to the general public in the United Kingdom. This announcement is only addressed to and directed at persons who (i) are outside the United Kingdom, (ii) have professional experience in matters relating to investments (being investment professionals falling within Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the “Financial Promotion Order”)), (iii) fall within Article 49(2)(a) to (d) (“high net worth companies, unincorporated associations, etc.”) of the Financial Promotion Order, or (iv) to the extent that doing so does not prejudice the lawful distribution of the announcement to the foregoing, are persons to whom an invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) in connection with the issue or sale of any Notes may otherwise lawfully be communicated or caused to be communicated (all such persons together being referred to as “relevant persons”). The Notes will only be available to relevant persons and this announcement must not be acted on or relied on by anyone who is not a relevant person. No key information document required by Regulation (EU) No 1286/2014 as it forms part of domestic law by virtue of the European Union (Withdrawal) Act 2018 (the “EUWA”) (the “UK PRIIPs Regulation”) for offering or selling the Notes or otherwise making them available to retail investors in the UK has been prepared and, therefore, offering or selling the Notes or otherwise making them available to any retail investor in the UK may be unlawful under the UK PRIIPs Regulation. Any offer of the Notes in the UK will be made pursuant to an exemption under Regulation (EU) 2017/1129 as it forms part of domestic law by virtue of the EUWA from a requirement to publish a prospectus for offers of securities.

This announcement does not constitute and shall not, in any circumstances, constitute a public offering nor an invitation to the public in connection with any offer within the meaning of the Regulation (EU) 2017/1129 (as amended), and any relevant implementing measure in the relevant Member State of the European Economic Area (the “Prospectus Regulation”). The offer and sale of the Notes will be made pursuant to an exemption under the Prospectus Directive, as implemented in Member States of the European Economic Area, from the requirement to produce a prospectus for offers of securities.

Manufacturer target market (MIFID II product governance) is eligible counterparties and professional clients only (all distribution channels). No PRIIPs key information document (KID) has been prepared as not available to retail investors in EEA.

UK MIFIR professionals/ECPs-only/ No UK PRIIPS KID – Manufacturer target market (UK MIFIR product governance) is eligible counterparties and professional clients only (all distribution channels). No UK PRIIPs key information document (KID) has been prepared as not available to retail investors in the United Kingdom.

This press release may include “forward looking statements” within the meaning of Section 27A of the Securities Act and Section 21E of the Securities Exchange Act of 1934, as amended. These forward looking statements can be identified by the use of forward looking terminology, including the terms “believes,” “estimates,” “anticipates,” “expects,” “intends,” “may,” “will” or “should” or, in each case, their negative, or other variations or comparable terminology. These forward looking statements include all matters that are not historical facts and include statements regarding Zenith Group or its affiliates’ intentions, beliefs or current expectations concerning, among other things, the Offering.

By their nature, forward looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Readers are cautioned that forward looking statements are not guarantees of future performance and that Zenith Group and its affiliates’ actual results of operations, financial condition and liquidity, and the development of the industry in which they operate may differ materially from those made in or suggested by the forward looking statements contained in this press release. In addition, even if the Zenith Group or its affiliates’ results of operations, financial condition and liquidity, and the development of the industry in which the Zenith Group operates are consistent with the forward looking statements contained in this press release, those results or developments may not be indicative of results or developments in subsequent periods. Given these risks and uncertainties, you should not rely on forward looking statements as a prediction of actual results.