Norsk Hydro Places NOK3,000 MM New Sustainability-Linked Bonds

Norsk Hydro Places NOK3,000 MM New Sustainability-Linked Bonds

Norway’s aluminium titan Norsk Hydro ASA announced the successful placement this week of NOK3,000 million (US$302.7 million) new senior unsecured sustainability-linked bonds, split into two equal tranches.

Per the firm, Hydro divided the placement into 6-year NOK 1,500 million with a floating rate of 3m Nibor + 2.000% p.a., and 6-year NOK 1,500 million with a fixed rate of 5.257% p.a. Hydro says the bond’s proceeds will go towards general corporate purposes.

The bonds were issued under a Euro Medium Term Note (EMTN) program Hydro implemented earlier this month. Hydro’s new bond program allows for up to €5 billion in medium term notes.

CFO Pål Kildemo said in a related press release that his firm is proud to be a leader in sustainability linked bonds.

“We are very pleased to be the first investment grade Norwegian company having issued sustainability linked bonds. This is the first issuance under Hydro’s Green and sustainability linked financing framework and EMTN Programme and a proof of our commitment to deliver on our ambitious roadmap to reduce our greenhouse gas emissions and increase our recycling of post-consumer scrap. These are key pillars to deliver on our strategy of strengthening our position in low-carbon aluminium and maintaining our strong competitive industry position. Interest from investors has been very strong and we have accomplished competitive terms given current market conditions.”

Norsk Hydro, which was founded in 1905, financed by the Swedish Wallenberg family and French banks, began its life named Norsk hydro-elektrisk Kvælstofaktieselskab (literally, “Norwegian hydro-electric nitrogen limited”) by Sam Eyde. The Norwegian government owns approximately 40% of the company at the present time. Norsk Hydro is one of the largest aluminium companies in the world, with plants in Rjukan, Raufoss, Vennesla, Karmøy, Høyanger, Årdal, Sunndalsøra, and Holmestrand. Norsk also has several plants abroad.