Hera Group: new 500 million euro green bond
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Hera Group: new 500 million euro green bond
Strong interest shown by international investors for the fourth “green” bond, maturing in 6.5 years, that will fund the Group’s strategic capex plan focused on sustainable and resilient management of the integrated water cycle, in the circular economy for regenerating resources and in the energy transition for developing renewables and energy efficiency. Subscriptions amounting to 5.5 times the amount offered were received.
The Hera Group has started the year with a new milestone in sustainable finance. The first Italian company to issue a green bond in 2014, today Hera successfully launched its fourth green bond, covered by its “Euro Medium Term Note Programme” (EMTN) bond issue plan, recently updated and increased in its maximum amount. This bond respects the Group’s Green Financing Framework (GFF), prepared on the basis of ICMA principles, aligned with the criteria of the European Taxonomy and certified by an independent firm.
The issue attracted significant interest from international investors, receiving orders for approximately 2.75 billion euro, almost 5.5 times the amount offered.
With this issue, Hera has once again given the market an opportunity to finance the Group’s strategic projects aimed at the green transition and aligned with the Taxonomy, once again confirming itself internationally as a reference company for sustainable finance.
“We are more than satisfied with the result of the placement, far exceeding expectations, of this fourth green bond: it makes our financial structure even greener and further strengthens the capital structure, making it even more resilient, as well as the credit profile of the multi-utility, in line with our Business Plan, which also calls for 2.5 billion euro in investments aligned with the European taxonomy, 98% of those eligible,” states Orazio Iacono, CEO of the Hera Group. “More specifically, this new issue provides additional stimulus for activities that create shared value, reducing the carbon footprint and regenerating resources, guaranteeing resilience in the services managed and thus making our businesses ever more sustainable. These commitments are already defined by the Group’s Green Financing Framework and the Climate Transition Plan with a Net Zero by 2050 target. This new green bond therefore confirms our goal of creating long-term value for our shareholders and our role as a multi-utility supporting the green transition for citizens, institutions and businesses.”
The characteristics of the Group’s fourth green bond and the areas financed
The fourth green bond of Hera Group (rated Baa2 with a stable outlook by Moody’s and BBB+/A-2 with a stable outlook by Standard & Poor’s), amounts to a total of 500 million euro, repayable in 6.5 years with a 3.250 % coupon and a 3.396% yield. The settlement date of the new issue has been scheduled for 15 January 2025. This green bond consists of senior, non-convertible, unsecured notes, intended for circulation among qualified investors. The new green bond is also expected to be assigned a rating in line with Hera’s. The transaction saw significant participation coming from international investors (in particular, Great Britain, France and Germany), mainly green and sustainable, confirming the interest towards the Group coming from abroad.
The bond is expected to be listed, as of the issue date, on the regulated market of Euronext Dublin and, at the same time or at a later date, on the regulated market of the Luxembourg Stock Exchange and on the ExtraMOT PRO multilateral trading system managed by Borsa Italiana.
The funds raised will be used to finance or refinance numerous projects, already ongoing or included in the Group’s Business Plan, selected on the basis of the Green Financing Framework (GFF), which work towards one or more of the goals on the UN’s 2030 Agenda for Sustainable Development (SDGs), subdivided into 3 areas:
- integrated water cycle (aligned to SDGs 6, 13 and 14): construction and extension of infrastructures for water collection, treatment and supply, with projects for wastewater collection and treatment;
- circular economy, pollution prevention and control (meeting SDGs 11, 12 and 13): advanced projects in plastics regeneration, anaerobic digestion of organic waste for the production of compost and biomethane, and waste collection and transport systems;
- energy efficiency and infrastructures (consistent with SDGs 7, 11 and 13): production of renewable electricity through photovoltaics and geothermal energy, development of district heating networks, installation, maintenance and repair of energy efficiency equipment and renewable energy technologies, including electricity transmission and distribution grids.
To ensure that the funds are correctly and transparently allocated, Hera has set up a monitoring and reporting process, which also ensures that the amount actually dedicated to each intervention, along with evidence of the environmental performance achieved, will be published in the Group’s 2024 Sustainability Report.
The partners in the transaction
Hera’s green bond issue was coordinated by BNP Paribas, Credit Agricole CIB, Mediobanca, UniCredit, BBVA, Intesa Sanpaolo, Banco Santander, Banca AKROS, Deutsche Bank, BPER Banca, Montepaschi di Siena, Barclays and Caixabank as Joint Bookrunners. The law firm Legance assisted Hera, while the firm Linklaters provided support to the Joint Bookrunners.
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A collaboration agreement has been signed to support companies and local areas on their path towards the energy transition and circular economy, through innovative solutions that combine sustainability with competitiveness
Saipem, a global leader in the engineering and construction of major projects in the energy and infrastructure sectors, and Hera Group, one of Italy’s leading multi-utilities, have signed a strategic collaboration agreement, initially lasting three years, with the aim of supporting Italian companies in their energy efficiency, decarbonisation and circular economy journeys.
The partnership draws on Saipem’s engineering and technological expertise and Hera Group’s long-standing experience in waste, water and energy services. Both companies share a firm commitment to sustainability and emissions reduction.
The agreement between the two organisations aims to support companies and local areas in the energy transition, offering concrete, integrated solutions to reduce emissions, improve consumption efficiency and enhance resource recovery. Particular attention will be paid to the needs of the most energy-intensive industrial sectors, such as ceramics, glass, paper, chemicals, cement, steel and other industries characterised by processes that are difficult to electrify, all of which face an increasingly complex and challenging path towards Net Zero.
Through this partnership, Saipem and Hera Group will make their multidisciplinary expertise available, offering a comprehensive portfolio of technologies and integrated solutions for energy efficiency, renewable energy, hydrogen and carbon capture systems. The objective is to identify, on a case-by-case basis, the most effective energy transition pathway from a technical, energy and economic perspective.
Interested companies will be able to benefit from a free preliminary audit designed to assess the best possible decarbonisation pathway from an energy and economic standpoint, as well as support in evaluating incentive schemes available at national and European level to help make projects feasible. This represents a concrete contribution across the entire energy transition value chain, a rapidly evolving sector that is increasingly strategic for the competitiveness of the production system.
For Saipem, the agreement with Hera Group forms part of its strategy to support the energy transition of the most complex industrial sectors. The partnership enhances the Group’s engineering and technological expertise and its ability to integrate innovative solutions, strengthening Saipem’s role as a technology partner for Italian industry. It also broadens access to solutions for energy efficiency, renewables, hydrogen and CO₂ capture, in line with Saipem’s evolution towards increasingly sustainable business models.
This agreement is fully aligned with the path outlined by Hera Group in its Business Plan to 2029, which envisages €3 billion in investments dedicated to the energy transition and circular economy of local areas and businesses. Also moving in this direction is the cutting-edge project for the capture of CO₂ emissions at the Ferrara waste-to-energy plant, proposed by Hera Group as lead partner in collaboration with Saipem. The project was selected in October 2024 to receive funding under the fourth call for mid-scale projects of the EU Innovation Fund, confirming the multi-utility’s commitment to promoting advanced technologies and strategic partnerships to make a concrete contribution to national and European climate targets.
Hera Group
Hera Group is one of Italy’s largest multi-utilities and operates in the environment, energy and water sectors, with over 10,500 employees. More than 7.5 million citizens receive at least one service provided by the Group. Listed since 2003, it is among the top 40 Italian companies by market capitalisation, is included in the FTSE MIB index and has been part of the Dow Jones Sustainability Index since 2020, recently renamed the Dow Jones Best-in-Class Index.
https://eng.gruppohera.it/group_eng/
Saipem
Saipem is a global leader in the engineering and construction of major projects in the energy and infrastructure sectors, both offshore and onshore. Saipem is a “One Company” organised into business lines: Asset Based Services, Drilling and Sonsub, Energy Carriers, Offshore Wind and Sustainable Infrastructures. The company has five fabrication yards and an offshore fleet of 17 owned construction vessels and 12 drilling rigs, nine of which are owned. Always focused on technological innovation, the company’s vision is “Engineering for a sustainable future”. For this reason, Saipem is committed every day to supporting its clients on their energy transition journey towards Net Zero, using increasingly digital means, technologies and processes geared towards environmental sustainability. Listed on the Milan Stock Exchange, Saipem operates in more than 50 countries worldwide and employs around 30,000 people of over 130 nationalities.
Website: www.saipem.com