International Finance Corporation (IFC), member of the World Bank Group, and sustainable solutions provider Sembcorp Industries (Sembcorp) on Wednesday announced the launch of $675 million- sustainability linked bond (SLB).

The ten-and-a-half-year Singapore dollar bonds were issued at a coupon rate of 2.66 per cent. The net proceeds from the SLB will be used for the purposes of financing the general corporate working capital requirements of Sembcorp and its subsidiaries (Group), refinancing the Group’s existing debt and/or financing or refinancing of the Group’s renewable energy, or potentially, other sustainable projects, according to the company release.

“Sembcorp, through its wholly-owned subsidiary Sembcorp Financial Services Pte Ltd, priced its inaugural SLB today, anchored by an investment of S$150 million from IFC. It also marks IFC’s first investment globally as an investor in a SLB, with the partnership between Sembcorp and IFC set to support more inclusive economic growth and private sector participation, while fostering sustainable business practices and significant employment opportunities,” the release said.

The interest rate of the SLB will be subject to a step-up margin of 0.25 per cent from the first interest payment date on or after April 1, 2026 if the stated SPT of greenhouse gas emissions intensity reduction to 0.40 tonnes of carbon dioxide equivalent per megawatt hour (tCO2e/MWh) or lower is not achieved by December 31, 2025, the release added.

Sembcorp has more than 3.3 gigawatts (GW) of renewable energy capacity comprising solar, wind and energy storage solutions in key markets such as Singapore, China, India, UK and Vietnam, with a target to quadruple its installed renewable energy capacity to 10GW by 2025 from 2.6GW in 2020.

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