The Public Investment Fund (PIF) raised EUR 1.65 bn from its inaugural EUR-denominated green bond issuance, Reuters reports, citing fixed-income news service IFR. The offering drew combined orders of more than EUR 8.7 bn.

The details: The fund raised EUR 850 mn from its seven-year tranche at 90 bps over mid-swaps, tightened from initial price thoughts of 90-95 bps. Meanwhile, the seven-year tranche, maturing in 2032, raised EUR 800 mn 58 bps, down from an initial 125 bps, Zawya reported.

Rated Aa3 (Stable) by Moody’s and A+ (Stable) by Fitch, the issuance comes under GACI First Investment Company’s euro medium-term note program and will be listed on the London Stock Exchange’s International Securities Market.

Where will the money go? The proceeds are earmarked to finance, refinance, or invest in eligible green projects under PIF’s Green Finance Framework, which covers renewable energy, green transport, and sustainable infrastructure.

The issuance capitalizes on EUR bond market conditions: “This move leverages favorable [EUR] bond market conditions, in terms of both lower interest rates and a much broader investor base in green bonds,” Apostolos Bantis, a managing director of fixed income at Union Bancaire Privee, told Bloomberg.

ADVISORS- Crédit Agricole CIB, JPMorgan, and Société Générale are joint global coordinators. Barclays serves as green structuring advisor, while BBVA, BNP Paribas, HSBC, IMI Intesa Sanpaolo, and ING act as joint active bookrunners.

REMEMBER- Last month, the fund sold USD 2 bn in USD-denominated bonds, after issuing some USD 4 bn in EUR-denominated bonds in January. The fund also closed a USD 7 bn murabaha credit facility — its first ever — during the same month.

What’s next for PIF? The sovereign wealth fund is expected to set out a new long-term investment strategy by the end of next month, set to prioritize investments inside the Kingdom. The PIF leads MENA sovereign investors with USD 15.9 bn deployed across 12 transactions since inception.

Tags: