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The European Investment Bank (EIB) has provided €200 million in financing to DLL, a global asset finance company for equipment and technology, and wholly owned subsidiary of Rabobank, to support small and medium-sized enterprises (SMEs) and contribute to a greener economy. As part of the agreement, DLL will provide a further €200 million, meaning that €400 million in total will be made available to SMEs in Spain and Italy. These two countries have seen their economies deeply impacted by the COVID-19 public health crisis and local businesses should benefit greatly from this programme.
This EIB financing will strengthen DLLs capacity to support the investments of businesses, especially in the transport, machinery and bio-economy sectors. DLL will leverage this facility to increase its support of sustainability investments for Spanish and Italian SMEs. DLL will specifically increase its financing for projects focused on the transition to a low carbon- economy, which is a major goal of the EIB Group activity. These projects include the installation of solar panels, replacement of self-propelled agricultural tractors and substitution of diesel-fuelled forklifts with electric equipment.
Furthermore, the programme will promote leasing as an alternative financing solution to standard bank loans. This type of financing is particularly beneficial to SMEs, which typically have limited capital and have difficulty providing sufficient collateral to secure loan financing, especially during difficult times. The companies accessing this credit line will be able to receive financing with competitive maturity and interest rate terms.
This will be the third transaction the EIB has contracted with DLL, and the first one between both entities with a specific sustainability component for Spain and Italy. Spanish companies will have access to 65% of this facility, while Italian businesses will have access to 35%.
EIB Vice-President Emma Navarro, responsible for EIB operations in Spain and for the Bank’s climate action, stated: “Supporting SMEs is one of the EIB Group top priorities, specially in a difficult context such as the one we are in today, when these small businesses are among the hardest hit by the Covid-19 pandemic. Hence, the importance of signing this agreement to provide funding to SMEs in Spain and Italy. Thanks to this operation, companies will be able to access new credit lines to maintain or continue growing their business and thus create jobs, while contributing to a green economic recovery of the EU”.
Luca Nuvolin, General Manager Italy and Head of Region South at DLL, concludes: “Many of our customers are going through difficult times and dealing with commercial uncertainty. DLL has a proud history of partnership and we have always stood with our customers, supporting them through good and bad times. We are thrilled that through this EIB transaction we will be able to serve select SME customers in Spain and Italy and can strengthen our sustainability ambitions through support of projects contributing to a low carbon- economy.”
Background information
Spain was one of the biggest beneficiaries of this financing, attracting around €9 billion. More than half of this, some €4.75 billion, helped to finance investment by SMEs, one of the EU bank’s priorities in Spain, which was the EU country that received most EIB support for this objective.
The EIB is the worlds largest multilateral provider of climate finance. Its goal is to be a leader in mobilising the finance needed to limit the average global temperature increase to 1.5°C compared to pre-industrial levels in order to meet the Paris Agreement objectives. On 14 November 2019, the EIB’s Board of Directors approved its new climate objectives and the new energy lending policy. The Bank will gradually increase its financing for climate and environmental objectives by up to 50% by 2025, with the goal of ensuring that the EIB Group mobilises at least €1 trillion in the critical decade between 2021 and 2030 to promote investments helping to meet these objectives. It also announced its intention to align all EIB Group activities with the Paris Agreement. To this end, the EIB will cease financing fossil fuel-based projects from late 2021.
DLL is a global asset finance company for equipment and technology with a managed portfolio of more than €35 billion. Founded in 1969 and headquartered in Eindhoven, the Netherlands, DLL provides financial solutions to the agriculture, food, healthcare, clean technology, construction, transportation, industrial, office equipment and technology industries in more than 30 countries. DLL partners with equipment manufacturers, dealers and distributors, as well as end-customers on a direct basis, to enable businesses to more easily access equipment, technology and software. The company also delivers insights and advice to partners and customers that drive smarter and more economical methods of use. DLL combines customer focus with deep industry knowledge to deliver sustainable solutions for the complete asset life cycle, including commercial finance, retail finance and used equipment finance. DLL is a wholly owned subsidiary of Rabobank Group. |
