Electrica sells green bonds for EUR 500 million amid record demand

Electricity supplier and distributor Electrica listed its first green bonds on the Luxembourg Stock Exchange. It was the largest issuance of its kind among Romanian companies, excluding financials.

Electrica, in which the Romanian Government controls a stake of just under 50%, issued green bonds worth up to EUR 500 million. It is using the proceeds to finance and refinance its projects, mainly for green energy production and energy storage.

The senior unsecured green bonds, maturing in five years, are now listed on the Luxembourg Stock Exchange. Admission to trading on the Bucharest Stock Exchange is estimated to take place at the beginning of August, Electrica said.

The company’s core activities are electricity distribution and supply and energy services, but it is expanding into renewables and battery storage.

Pricing reaches 2.3 percentage points above benchmark rate

Credit appraisal agency Fitch has assigned the 4.375% senior unsecured green notes a BBB- rating. It is the lowest investment grade. The projects will have a limited connection to Electrica’s 100%-owned distribution and supply subsidiaries Distribuție Energie Electrică Romania (DEER) and Electrica Furnizare, the note adds.

Electrica targets 1 GW of installed renewable energy capacity by 2030 alongside the deployment of 900 MWh of energy storage

The company’s inaugural debt securities were priced at a yield of 4.566%, according to a regulatory filing. It was 2.3 percentage points above the benchmark mid-interest rate swap. The demand from investors at the final price exceeded the supply by more than 11.5 times, marking a record oversubscription in bond issuances of Romanian companies, Electrica pointed out.

Moreover, it was the largest green bond issuance in Romania excluding financial institutions. Electrica targets 1 GW of installed capacity by 2030 alongside the deployment of 900 MWh of energy storage.

Electrica grows market capitalization by one fifth this year

Banca Comercială Română (member of Erste Group), BNP Paribas, Citi, ING, J.P. Morgan and Raiffeisen Bank International were the joint global coordinators and joint bookrunners in the transaction, while BT Capital Partners, IMI-Intesa Sanpaolo, Société Générale and UniCredit were joint bookrunners.

Electrica has EUR 1.06 billion in market capitalization. Its shares surged 21.1% since the end of last year.