Iberdrola has placed an €800m hybrid green bond in the Euromarket.
Demand reached more than €3bn and consists of more than 200 international investors, mainly from Europe and the United Kingdom.
With demand oversubscribed by 3.75 times, this issuance marks Iberdrola’s most competitive hybrid transaction in three years.
The company said this success was testament to strong investor confidence in its financial strength and growth prospects, even amid a challenging geopolitical environment.
The bond issued is perpetual but has a par call option in August 2030.
The proceeds will be used to refinance the renewable assets allocated to the 2019 hybrid that is being replaced. The call back will take place soon, thus keeping the company’s hybrids stack stable at €8.25bn.
The company said it had taken advantage of the improvement in both interest rates and credit spreads, and its flexibility to refinance this transaction had contributed to its success.
The hybrid bonds count as 50% capital, in accordance with the methodology of the main rating agencies, so this operation contributes to maintaining the group’s credit ratings. The last issuance of this type of debt by Iberdrola dated from January 2023 with a coupon of 4.87%.
Nine top-tier international banks have participated in the placement: BNP, Unicredit, JP Morgan, HSBC, Bank of America, Santander, Natixis, SMBC and Commerzbank, which have facilitated access to investors.
This represents Iberdrola’s eighth public operation in the market so far in 2024, which have raised a total of €6.6bn.