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Singtel subsidiary Optus prices maiden sustainability-linked bond at 2.6%

The Edge Singapore
The Edge Singapore11/18/2021 06:25 PM GMT+08  • 1 min read
Singtel subsidiary Optus prices maiden sustainability-linked bond at 2.6%
Singtel is the first telco in Asia Pacific to issue a SLB
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Optus, Singtel’s subsidiary in Australia, has priced its A$300 million 7-year fixed-rate sustainability-Linked Bond (SLB) at 2.6% per annum – making Singtel the first telco in Asia Pacific to raise funds using such an instrument.

The bond, which will be issued on Nov 24, is tied to a target of reducing its absolute greenhouse gas emissions by 25% (Scope 1 and 2 in tCO2e) by 2025, compared to a 2015 baseline.

This is in line with its goal to meet the Singtel Group’s SBTi-approved 2030 targets of a 42% reduction compared to the 2015 baseline.

The coupon rate of the SLB will be subject to a step-up margin of 0.25% per annum from the interest period commencing 24 November 2025 if the stated target is not met.

“There has been strong demand for Optus’ inaugural SLB issuance from the investor community and we are highly encouraged that our efforts to link financing to sustainability has been well received,” says Singtel’s CFO Arthur Lang.

Australia and New Zealand Banking Group Limited, Commonwealth Bank of Australia and Westpac Banking Corporation acted as joint sustainability co-ordinators, lead managers and bookrunners.

See also: US yields may jump back to 4% as SVB rescue reverses haven trade

Singtel closed on Nov 18 at $2.52, unchanged for the day and up 9.09% year to date.

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