Established in 2017,  Zenobē has ~735MW of grid-connected batteries live or in late-stage construction, and a fleet of 1,200 funded electric buses (By 2026, Zenobē is aiming to have increased its total fleet funded by the platform to 2,000 buses, and an additional 1,000 electric buses with the £300m Capex facility funding. 

Zenobē’s EV fleet proposition is split into three key components that together provide an end-to-end solution for bus and other vehicle fleet operators, covering vehicle ownership, charging infrastructure and battery storage. The majority of the fleet comes with 15-year charging infrastructure at the operators’ depots.

The company’s Battery Electric Buses are in heavy demand, as local councils and bus operators in the UK aim to evolve their fleets to meet emission targets in a market in which only around 5% of the 37,800 buses currently in service on UK roads are electric. This demand is supported by government funding schemes, such as ZEBRA, with the Government pledging to fund at least 4,000 new zero-emission buses by the end of 2024.

With NatWest having supported Zenobē with both the financing of some of its innovative battery storage projects and by advising on the first-of-its-kind green funding platform for EV fleets, Zenobē approached us to discuss an upsize of the original facilities in the platform and the addition of four new term loans.  

Zenobē’s multi-source debt funding platform enables them to raise funding on an ongoing basis against contracted cashflows from existing and future contracts with operators. This supports both the growth of their business and, by extension, the roll-out of zero-emission buses across the UK.

In the role of Sole Debt Advisor and Sole Private Placement Agent, the NatWest team approached selected banks and institutional investors for the upsize before adding six new lenders to the funding platform, joining the existing eight, including NatWest. In discussion with all lenders, the deal team secured £410 million of new funding on top of the £241 million raised in the original transaction.

The newly raised debt was structured as an upsize of the existing Capex facility to £300 million, an upsize of the Working Capital Facility to £30 million and the Debt Service Reserve Facility to £35 million. Furthermore, a bank term loan, worth £105 million, and two institutional term loans (structured as a green Private Placement (“PP”)), sized at £40 million and £25 million, were added. NatWest Markets acted as Hedge Co-ordinator for this transaction, and NatWest now provides total commitments of £83.1 million across the financing platform.

Nicholas Beatty, Co-Founder Director, Zenobe, commented: “We are excited to have successfully raised an additional £410m of debt in addition to the existing £241m platform, to bring the total funding value of our EV financing platform to £651 million, now the largest electric bus platform financing in Europe. We thank NatWest for their guidance in structuring this deal, and all our lenders for their support. Having reached this milestone means we are now very well equipped to enable the faster take-up of EV buses in the UK. Through this, we are able to help meet legally binding climate change targets while also improving air quality across the country.”

Joe Taylor, Head of Infrastructure, Project & Asset Finance, NatWest, said: “We are delighted to have helped our customer with this upsize of their pioneering funding platform, on which we advised two years ago. This additional funding will help to further speed up the use of electric vehicles in the UK transport system. The transaction also highlights our ambition to play a leading role in helping to address the climate challenge, a key part of which is assisting the UK’s renewable energy transition.”

Sonia Gadhia, Head of European PP Distribution, NatWest, said “We are very pleased to have worked with the Zenobe team again following the debut PP in 2022. It was great to see an increase in interest from UK Insurance institutions focused on high quality opportunities which is testament to Zenobe’s positive performance as well as investors getting more comfortable with the asset class without the need for an external rating and wanting to contribute to help reduce UK emissions.”