EBRD backs Croatia’s first sustainability-linked bond

• EBRD invests €10 million in Croatia’s first sustainability-linked bond
• Meritus Ulaganja raising finance for business expansion while committing to social and environmental advancement
• Investment supports local capital market development

The European Bank for Reconstruction and Development (EBRD) is supporting the development of capital markets in Croatia by investing in the country’s first sustainability-linked bond. The Bank is investing €10 million in a €40 million issue by Meritus ulaganja d.d., a  leading business process outsourcing (BPTO) provider in south-eastern Europe, active in call centres, information technology and employment services.   

The holding company and its subsidiaries, which operate under the umbrella of M+ Group, will use the funds to finance further business expansion through acquisitions, while committing to green and sustainable growth. The investment will support the group’s plans to reduce its greenhouse gas emissions by 25 per cent by 2027 and to increase the participation of women in management positions to 51 per cent by the end of 2030.

Croatia’s first sustainability-linked bond is also Meritus Ulaganja’s debut bond issue. The introduction of sustainability-linked financing to M+ Group’s portfolio of financial instruments is a natural step in the group’s growing commitment to sustainability and transformation, to ensure that it has a greater positive environmental, social and governance (ESG) impact.

Victoria Zinchuk, EBRD Director for Croatia, said: “M+ Group’s sustainability-linked bond is a milestone for Croatia as the first instrument of its type issued locally. By issuing this bond, which underpins an ambitious sustainability strategy, the group signals its strong commitment to reducing its carbon footprint, as well as to promoting gender equality in the workplace. We are proud to support M+ Group in its sustainability journey.”

Darko Horvat, President of the Management Board of Meritus ulaganja, said: “M+ Group is strongly committed to sustainability as a crucial element of our business. As a company, we focus on people – our employees, clients and their customers. Therefore, we strive to promote equality and diversity, while minimizing our environmental impact. We already proved that by starting regular reporting on sustainability and now we are taking a step further. I am very proud of the fact we were able to pioneer the sustainability-linked bond in the Croatian market. M+ Group is very appreciative of the EBRD’s contribution as an investor in this bond, as well as to the development of the Croatian capital market in general, and would like to thank everyone who made this achievement possible.”

Headquartered in Zagreb, M+ Group is a prominent multinational BPTO service provider, with more than 11,000 employees. Serving a large customer base, it has a broad geographic footprint, operating in 12 countries and catering to close to 60 markets, with a leading position in south-eastern Europe.

The EBRD is a leading institutional investor in Croatia. The Bank has invested more than €4 billion in the country to date. Its focus in the country is on supporting private-sector competitiveness, developing capital markets and promoting the commercialisation of public companies. Its investments are combined with support for policies that promote a more enabling business environment.