Hyundai Heavy, First Successful $300M Overseas Green Bond Offering... "Expanding Investment in Eco-Friendly Ships"

"Orders Worth $600 Million from 42 Institutions Worldwide... Twice the Issuance Amount"

Jung Ki-sun, CEO of Hyundai Heavy Industries Holdings, introducing the group's future vision, 'Future Builder,' at the Hyundai Heavy Industries Group press conference held at 'CES 2022' in Las Vegas, USA, on January 5th (local time). (Image source=Yonhap News)

[Asia Economy Reporter Moon Chaeseok] Hyundai Heavy Industries has successfully completed its first overseas green bond public offering. It issued $300 million (approximately 366 billion KRW), with global investors placing orders totaling $600 million (approximately 732 billion KRW). As the shipbuilding industry enjoys a boom driven by global eco-friendly trends and LNG order surges, the company plans to increase proactive investments in eco-friendly vessels.

On the 22nd, Hyundai Heavy Industries announced that it received $600 million in orders from 42 institutions worldwide for a $300 million foreign currency green bond with a 5-year maturity, guaranteed by KDB Industrial Bank. This amount is twice the total planned issuance. Investors from Asia, Europe, and the Middle East placed orders. The lead underwriters were KDB Industrial Bank, BNP Paribas Securities, HSBC Securities, and Standard Chartered Securities, jointly managing the issuance.

The bond’s coupon rate was set at the 5-year US Treasury yield plus a 0.95 percentage point spread, which is 0.20 percentage points lower than the rate initially proposed by Hyundai Heavy Industries. A company representative explained, "Despite unstable international conditions and deteriorating investor sentiment due to US interest rate hikes, Hyundai Heavy Industries’ ESG (Environmental, Social, and Governance) management activities have drawn positive responses from investors."

Hyundai Heavy Industries stated that the funds raised will be used for building eco-friendly ships. With the shipbuilding market entering a boom phase, the company plans to proactively secure funds to strengthen investments in eco-friendly vessels and establish a virtuous cycle of sustainable growth based on ESG management. Previously, Hyundai Heavy Industries signed a green loan contract worth 480 billion KRW in June 2020. In March last year, it issued 300 billion KRW worth of won-denominated green bonds, expanding investments in eco-friendly ships. A company representative emphasized, "We will solidify our leading market position based on eco-friendly ship technology."

In November last year, Hyundai Heavy Industries Group presented its ESG management vision as "A Clean Future Starting from the Sea," and declared the ESG slogan "Beyond Blue, Forward to Green."

This content was produced with the assistance of AI translation services.