Enel launches the first issue linked to European taxonomy. The Italian energy multinational, through its subsidiary Enel Finance International, has launched a “Sustainability-Linked bonds” in two tranches aimed at institutional investors for a total of 1,5 billion euro. This is the first public placement worldwide that combines the EU taxonomy with the United Nations ESG goals on the fight against climate change. The issue received requests in excess almost 3 times, totaling total orders for an amount of approximately 4 billion euro.
The market shows that it appreciates the bonds placed by the most capitalized group in Piazza Affari. The title gains 0,56% to 5,43 euros per share.
The new issue – explains a note – provides for the first time for Enel to use multiples Key performance indicators (Kpi: key performance indicators) by tranche, further strengthening Enel's commitment to an acceleration in the energy transition. For the first time in a public placement of a bond, a tranche of the issue combines a Kpi linked to the EU taxonomy with a Kpi linked to the United Nations Sustainable Development Goals. The other tranche of the bond is linked to two KPIs associated with the group's trajectory of complete decarbonisation, through the reduction of direct and indirect greenhouse gas emissions, as specified below.
Enel's sustainable bond in double tranche at 8 and 20 years
The issue – which has an average duration of around 14 years – has an average coupon of 4,25% and is structured in the following two tranches:
- the first of 750 million euros at a fixed rate of 4%, with a maturity date set at 20 February 2031. The issue price is set at 98,877% and the effective yield at maturity it is equal to 4,168%; the interest rate will remain unchanged until maturity, subject to the achievement of the following Sustainability Performance Targets, specifically: for the Kpi linked to the "Percentage of Capex aligned with the EU taxonomy (%)", the achievement of an SPT equal to or higher 80% as at 31 December 2025 for the period 2023-2025; for the Kpi connected to the "Intensity of GHG Scope 1 emissions relating to the production of electricity (gCO2eq/kWh)", upon the achievement of an Spt equal to or less than 130gCO2eq/kWh as at 31 December 2025.
- the second tranche is equal to 750 million euros at a fixed rate of 4,5%, with maturity set at 20 February 2043. The issue price is set at 97,669% and the effective yield at maturity it is equal to 4,682%. The interest rate will remain unchanged until maturity, subject to the achievement of the following Spt: for the Kpi linked to the "Intensity of GHG Scope 1 and 3 emissions relating to Integrated Power (gCO2eq/kWh)", on the achievement of a Spt equal zero as at 31 December 2040; for the Kpi connected to the "Absolute GHG Scope 3 emissions relating to Gas Retail (MtCO2eq)", upon reaching a SPT of zero as at 31 December 2040.
Both emissions are linked to sustainability objectives (ESG); so if the Italian group led by CEO Francesco Starace does not hit them, he will be called to pay a higher coupon (25 basis points for each step up event). It is expected that the proceeds of the issue will be used by EFI to finance the ordinary financial needs of the group.
The banks involved
The placers of both bonds are: Banca Akros, Bnp Paribas (B&D), Bper Banca, Credit Agricole Cib, Cixa, Citi, Commerzbank, Goldman Sachs, IMI Intesa Sanpaolo, Ing, JP Morgan, Mediobanca, Morgan Stanley, Natixis, Santander , SocGen, Unicredit.
De Paoli (Enel): "We are in line with the EU taxonomy"
“It is with enthusiasm that we bring to the market this innovative tool, the first of its kind to establish a link between the EU taxonomy and the UN SDG 13 on the fight against climate change,” he said. Albert DePaoli, CFO of Enel -. With our investments in decarbonised technologies we are in line with the EU taxonomy and therefore ready to achieve the UN Sustainable Development Goals. Strengthened by this synergistic approach, we work tirelessly to achieve our decarbonization and electrification goals, while strengthening the energy security of the countries in which we operate, and paving the way for the creation of sustainable and long-term value for all".
The success of the bond loan, continues the note, is a clear recognition of the sustainable strategy of the Group and its ability to generate value by orienting the investment plan in line with the criteria of the EU taxonomy and at the same time contributing to the achievement of the United Nations SDGs.
