Nedbank Corporate Investment Banking (NCIB) Energy and Metals – Global Commodity Finance (E&M) and Syndication and Distribution Teams are pleased to announce the successful conclusion of the IXM S.A. (IXM) syndication. This includes a secured, uncommitted borrowing base revolving credit facility tied to environmental, social and governance (ESG) that closed at an impressive US$1.2 billion to finance Africa-sourced copper cathodes.

The facility received robust backing from IXM’s banking partners, showing an expanded lender pool and increased transaction appetite – in commitments from 22 banks – compared to last year..

Understanding ESG in commodity finance

With the global shift towards sustainability, investors increasingly prioritise companies demonstrating strong ESG practices, particularly in sectors like energy and metals. This focus mitigates risks and supports transitioning to a low-carbon economy, fostering a more resilient and responsible commodity trading landscape. Integrating ESG factors into commodity finance is crucial for driving positive change and ensuring long-term success.

Nedbank’s role in the IXM S.A syndication

Nedbank  is proud to have played a role in this landmark syndication as an Active Bookrunner and Mandated Lead Arranger (ABMLA) alongside 4 international banks. Notably, Nedbank was the only South African bank to be an active book-runner, a testament to the company's strong relationship built over the years. By prioritising trade funding that aligns with ESG principles, financial institutions can support sustainable practices while driving growth in this vital sector.

The syndication was initially launched at US$1 billion but saw significant oversubscription, with 22 lenders (including 7 new ones) eventually committing to the facility. The company decided to scale back the facility, which closed at US$1.2 billion, making it the largest IXM syndication to date. 

IXM's market position and global reach

IXM ranks among the top global traders of non-ferrous metals, significantly influencing every phase of the supply chain for metals such as copper, zinc, lead concentrates, aluminium, and nickel. The group is headquartered in Geneva, Switzerland, but has a global footprint with 13 offices worldwide. 

Underpinning IXM’s commitments, the facility is linked to significant sustainability targets to enhance the company’s operations and its value chain's environmental and social impact. Established under the Sustainability-Linked Loan Principles, these targets are assessed annually and include third-party verification to ensure accountability.

The following banks were mandated as arrangers for this facility: UBS Switzerland AG, CA Indosuez (Switzerland) SA, Coöperatieve Rabobank U.A., Natixis, and Nedbank Limited (our London branch). The same institutions acted as active bookrunners, with UBS Switzerland AG also serving as the facility agent, global coordinator, security agent, and documentation agent. Additionally, UBS Switzerland AG and Coöperatieve Rabobank U.A. acted as joint sustainability coordinators for the facility.

Key features of the borrowing base facility

This facility provided by NCIB forms a fundamental part of IXM’s financing of its African copper trade flows, a vital energy transition metal. The structure incorporates innovative ESG key performance indicators (KPIs) to promote sustainable business practices. This transaction perfectly aligns with Nedbank’s strategy to support and grow trade finance on the continent. 

Prospects for structured commodity finance

This successful syndication underscores Nedbank's capability to lead and bookrun deals in a market traditionally dominated by European players. It's a testament to the expertise and collaboration of our teams across multiple divisions.

Our involvement in the IXM syndication highlights our leading position in African trade finance, more specifically in the energy and metals space, and in supporting sustainable practices in commodity market trading. This strategic focus enhances the bank’s reputation and drives growth in key sectors across the continent.

The success of this syndication sets a precedent for future deals in the structured commodity finance sector, emphasising the integration of ESG principles. This indicates a move towards more sustainable and accountable financing methods to foster ongoing growth and innovation in the industry.