Iberdrola issues 8-year green bonds for 750 million to finance the East Anglia wind farm. The coupon of the issue was 1.25%, with the price fixed at 99.055% of its nominal value. The spread has been fixed at 67 basis points above the reference ‘midswap’ to the corresponding term, far below the final offer of ‘midswap’ plus 85 basis points, Europa Press reports.
The underwriting banks were UniCredit, Banco Sabadell, HSBC, Morgan Stanley, NatWest Markets, Santander, UBS and SMBC Nikko.
The funds obtained whose sustainable use was validated by the independent agency Vigeo Eiris, will be devoted to finance and refinance part of the investment of the East Anglia offshore wind farm under development by Iberdrola in the United Kingdom.
The demand for the issue almost tripled the final offer figure, exceeding 2,000 million euros
The demand for the issue whose maturity date is October 28, 2026 almost tripled the final offer figure, exceeding 2,000 million euros. More than 150 investors participated in the issue.
This is the second issue of green bonds closed by the utility for the financing of East Anglia, after a 700 million euros was placed last March.
The cost of the operation was very competitive given the volume reached, as well as the current market environment, characterized by uncertainty in the evolution of interest rates due to the existing risks, mainly political, and the gradual internalization of the market regarding the end of the stimuli period in the frame of the European Central Bank monetary policy, sources of the market note.
Thus, the new issue premium paid by Iberdrola is around 8 basis points. This is undoubtedly a very competitive level in the current market environment, in which premiums around 20 basic points have been seen for operations with similar characteristics just a few weeks ago.
Leader in green bonds issues
The company chaired by Ignacio Sánchez Galán is a pioneer in the issuance of green bonds, earning it the title of largest global green issuer at company level during 2016 and 2017. This type of operations guarantee that the funds obtained is used to finance sustainable and socially responsible projects. In addition, these operations are part of the energy company’s strategy to ensure that a large part of its liabilities has a green format, in line with the company’s commitment to a low-carbon energy mix.
Iberdrola closed the increase and extension of two multi-currency syndicated loans worth 5,300 million euros with 24 financial entities
In this line, Iberdrola closed the increase and extension of two multi-currency syndicated loans worth 5,300 million euros with 24 financial entities last January. This was the largest operation subject to sustainability criteria carried out in the world.
In March, Iberdrola already placed the previous operation to finance East Anglia, the second hybrid green bond issue, after one carried out last November for 1,000 million euros. With the latter the company inaugurated this market in Spain.
The East Anglia ONE project of Iberdrola´s British subsidiary Scottish Power, with an area equivalent to 30,000 football fields will be the world largest offshore wind farm and provide electricity to half a million homes. When it starts operating in 2020 on the southeast coast of England, its 102 wind turbines will supply up to 714 megawatts (MW) of clean energy.