Blue Earth Capital Closes Sustainability-Linked Loan With Asian Garment Manufacturing Business

Blue Earth Capital AG (BlueEarth), the specialist global impact investor, announced the completion of a US$30 million direct credit investment into Q Collection Pte. Ltd. (Q Collection). Headquartered in Singapore, Q Collection Pte. Ltd. (also known as SQ Group), is a leading vertically integrated apparel manufacturer with its manufacturing operations in Bangladesh.

The ready-made garment (RMG) manufacturing industry is a key contributor to the economic success of Bangladesh. It accounts for over 80% of the country’s exports, employing over 4.5 million individuals, mostly women from economically disadvantaged backgrounds.

At the same time, the garment sector in Bangladesh is the largest industrial contributor of CO2 emissions representing 15.4% of the country’s total. Given the significant scale, improvements are needed to minimize the sector’s environmental impact. BlueEarth is committed to supporting Q Collection in delivering on their pledge to deploy advanced ESG practices as part of an overarching climate and social sustainability strategy.

This collaboration marks BlueEarth’s first sustainability-linked loan. It features select loan terms tied to Q Collection’s performance in achieving predefined ESG targets linked to the Higg Index, a comprehensive rating tool developed by the Sustainable Apparel Coalition which rigorously measures a company’s sustainability across the entire value chain.

This structure allows both parties to align environmental and social impact outcomes with financial objectives. Q Collection’s long-standing commitment to progressive sustainable manufacturing practices includes greater use of renewable energy, sustainable materials, recyclable packaging, production waste minimization, and more efficient production technology.

The company is also committed to building an inclusive and empowering workplace for its over 19,000 employees.

BlueEarth’s capital infusion will be used to develop a new manufacturing site which includes upgrading to more energy efficient machines and facilities, the installation of rooftop solar systems and a rainwater harvesting initiative.

This will enable Q Collection to continue to expand its operations and create more jobs for underserved communities, while contributing to a more sustainable garment manufacturing sector.

Amy Wang, Head of Private Credit at Blue Earth Capital said: “We are excited about our partnership with Q Collection to help them expand their sustainable production capacity and create thousands of new jobs. We have aligned on a rigorous Environmental and Social Action Plan alongside the terms of the financial structure to ensure that we deliver on both impact and financial return.”

“Closing our first sustainability-linked loan is an important step for us at BlueEarth as we continue to seek to tackle the world’s most pressing social and environmental challenges.”

Senthil Selvan, the CEO at Q Collection added: “We are thrilled to have BlueEarth as our partner in accelerating our growth-oriented business strategy and sustainability ambitions. This investment from BlueEarth is perfectly timed, as it will be instrumental in executing our ongoing priorities, which include strategic capacity expansion, further technology integration, and several flagship sustainability projects.”