(Tokyo, 31 March 2025 ) Trustar Capital Partners Limited (“Trustar Capital”) is pleased to announce that it has transitioned the bank loan (the “Loan”) previously implemented through KG Holdings Co., Ltd. (“KGHD”), the holding company of Kaneko Group when it entered into a strategic investment with Kaneko Group back in 26 December 2023, into sustainable finance (converting into Sustainability-Linked Loan) today with opinion obtained from a third-party rating agency.
The Loan, originally formed with MUFG Bank Ltd. as the arranger, has now been successfully converted into sustainable finance. This transition was achieved with the support of existing lenders and a third-party assessment by Japan Credit Rating Agency Ltd. confirming compliance with both the Sustainability-Linked Loan (“SLL”) Principles1 and Sustainability-Linked Loan Guidelines2.
SLL is a financing mechanism designed to incentivize borrowers’ sustainability progress by linking loan terms such as interest rates to the achievement of ambitious Sustainability Performance Targets (“SPTs”), which are derived from Key Performance Indicators aligned with the borrower’s core sustainability strategy. Under the Loan, SPT is defined as the net increase in waste paper collection volume at Kaneko Corporation (“Kaneko”, led by President & CEO of Takuzo KANEKO), the core company of Kaneko Group, and the incentives of preferential interest rates are applied based on SPT achievement levels.
Kaneko is a leading integrated recycling solution provider, delivering one-stop services from collection, transportation and intermediate processing (including re-manufacturing of waste paper) of not only waste paper, but also various other materials including plastics and metals. Kaneko Group has established its most critical objectives to achieve both business growth and contribution on eco-friendly sustainable society: “Accelerating group-wide initiatives in strengthening recycling, reuse and waste reduction” as well as “Enabling customers’ circular economy”, where the SPT metric of net increase in waste paper collection volume directly links with the progress towards these objectives.
Trustar Capital has consistently conducted investment activities guided by “Investing for Good” philosophy. By focusing on responsible investments with considerations on sustainability and ESG, it will not only bring economic returns, but also long-term and continuous benefits for society and environment. Since formalizing group-wide ESG policy in 2018, Trustar Capital has systematically embedded sustainability and ESG considerations into each stage of the investment lifecycle. The transition into sustainable finance collaborating with portfolio company this time further promotes “Investing for Good” philosophy through actionable movements.
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About KG Holdings Co., Ltd.
Established: 2023
Representative: Takuzo KANEKO, President and CEO
Headquarters: 990 Okitsu-nakamachi, Shimizu-ku, Shizuoka, Japan
Website: https://kaneko-hd.co.jp/
About Trustar Capital Partners Limited
Trustar Capital Partners Limited specializes in private equity fund business globally with a focus on Asia including Japan.
Trustar Capital Japan Fund provides hands-on support to help medium-sized Japanese enterprises with strong brand equity and technological advantage to achieve sustainable growth. Since the establishment in 2004, Trustar Capital Japan Fund has executed 17 platform investments across target sectors.
Websites:
(Japanese) http://www.trustarcapital.jp/
(English) http://www.trustarcapital.com/
For inquiries, please contact:
Trustar Capital Partners Japan Limited
03-5211-3830 (Taizo SEKO)
(１) Asia Pacific Loan Market Association (APLMA), Loan Market Association (LMA), Loan Syndications and Trading Association (LSTA). “Sustainability-Linked Loan Principles 2023” (https://www.lsta.org/content/sustainability-linked-loan-principlessllp/)
(２) Ministry of the Environment: Sustainability-Linked Loan Guideline 2024 (https://www.env.go.jp/content/000062348.pdf)