VERBUND’s €500 Million Innovative Green and Sustainability-Linked Notes Offering

White & Case LLP and Binder Grösswang advised VERBUND AG on the deal.

VERBUND AG executed its issuance of innovative green and sustainability-linked notes with a volume of €500 million.

The Notes combine environmentally sustainable (‘green’) use of proceeds with a coupon step-up linked to company-wide sustainability goals (‘sustainability-linked’). Investors with a proven focus on sustainability represented more than 90 percent of the final order book and the notes where oversubscribed by a factor of four.

The notes have a 20-year term and a coupon of 0.900% and are linked to defined sustainable targets:

VERBUND’s newly-installed renewable energy production capacity from hydropower, wind power and photovoltaic, including its subsidiaries, reaches at least 2,000 MW.

The additionally installed transformer capacity, including VERBUND’s subsidiaries, reaches at least 12,000 MVA.

Both sustainable targets are expected to be reached by December 31, 2032 and, if VERBUND fails to achieve the targets by this date, the original rate of interest will be increased by 25 basis points up to the maturity date (‘sustainability-linked step-up’).

VERBUND will allocate an amount equal to the net proceeds to certain green projects, aiming to complete such allocation within three years of the issuance of the notes. These green projects, modernisation of certain grid systems in Austria and the refurbishment and extension of the existing Töging-Jettenbach hydropower plant in Germany comply with VERBUND’s Green Financing Framework.

VERBUND Green Financing Framework has been developed in alignment with the Green Bond Principles 2018 and the Sustainability-Linked Bond Principles, 2020. It also aligns with the most recent draft of the Delegated Acts of the EU Taxonomy, published in November 2020.

The White & Case team in Frankfurt which advised on the transaction included partner Karsten Wöckener (Picture), local partner Peter Becker and associates Florian Fraunhofer, Philipp Kronenbitter and Daniel Sander.

The Binder Grösswang team consisted of partners Emanuel Welten, Tibor Fabian and Florian Khol and attorney Philipp Tagwerker in Capital Markets.

Involved fees earner: Tibor Fabian – Binder Grösswang Rechtsanwälte GmbH; Florian Khol – Binder Grösswang Rechtsanwälte GmbH; Philipp Tagwerker – Binder Grösswang Rechtsanwälte GmbH; Emanuel Welten – Binder Grösswang Rechtsanwälte GmbH; Peter Becker – White & Case; Florian Fraunhofer – White & Case; Philipp Kronenbitter – White & Case; Daniel Sander – White & Case; Karsten Wöckener – White & Case;

Law Firms: Binder Grösswang Rechtsanwälte GmbH; White & Case;

Clients: Verbund AG;

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Author: Federica Tiefenthaler