Dubai – Mubasher: Mashreq Bank has arranged a $3.25 billion leverage buyout sustainability-linked financing round for GEMS Education.

The banks served as lead sustainability coordinator, initial mandated lead arranger and bookrunner, account bank, global agent, and conventional facility agent, according to a press release.

This financing package will significantly advance sustainability in the education sector. Through this inaugural sustainability-linked facility, Mashreq supports GEMS Education in its pursuit of sustainability and educational excellence.

The facility includes key performance indicators (KPIs) targeting Sustainable Development Goals 4 and 7. These KPIs aim to increase renewable energy use in schools, certify teachers in climate and environmental topics through the United Nations Climate Change programme, and develop a scholarship program for diversity and inclusion.

GEMS is also committed to improving resource management and reporting to promote quality and inclusive education.

On June 18, 2024, a consortium of banks, including Mashreq, Dubai Islamic Bank (DIB), Abu Dhabi Commercial Bank (ADCB), and First Abu Dhabi Bank (FAB), underwrote and pre-funded the multi-billion dollar facility.

Sunny Varkey, Founder Chairman of GEMS Education, said: “By partnering with Mashreq to secure this innovative financing structure, we can advance our sustainability objectives and align our educational offerings with global environmental standards.”

Ahmed Abdelaal, Group CEO of Mashreq, added: “This landmark transaction not only underscores Mashreq's leadership in Sustainable Finance but also sets a new standard for the education sector. By linking financial incentives to sustainability performance, we are supporting GEMS in its commitment towards environmental and societal advancements.”

Founded in 1959 by the Varkey family and headquartered in Dubai, GEMS Group is a leading K-12 private education provider, educating over 135,000 students across 61 schools in the UAE, Qatar, and Europe.

Mashreq aims to finance and facilitate $30 billion in sustainable financing by 2030, demonstrating its commitment to sustainability.

It is worth noting that Mashreq Bank’s net profit surged to AED 2 billion in the first quarter (Q1) of 2024 from AED 1.61 billion in Q1-23.