Masdar's $3B Green Bond Journey at LSE

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by KnowESG
KnowESG_Masdar's $3B Green Bond Journey at LSE
Image courtesy of Masdar

Abu Dhabi Future Energy Company PJSC - Masdar has achieved a significant milestone by successfully completing its inaugural green bond issuance of US$750 million in 10-year senior unsecured Notes on the London Stock Exchange (LSE).

On July 19, 2023, Masdar successfully completed its issuance of a US$750 million 10-year green bond on the LSE, receiving overwhelming demand from regional and international investors, with oversubscription exceeding five times the original amount.

This achievement marks a significant juncture in the remarkable journey of the UAE's leading renewable energy entity, established in 2006 under the leadership of its founding CEO, now Chairman, Dr Sultan Al Jaber. Dr Sultan Al Jaber has been a trailblazer in the global renewable energy sector for 17 years.

Under Dr Sultan's visionary guidance, Masdar has successfully developed more than 20GW of renewable energy capacity across 40 countries, invested over US$30 billion, and aims to attain a portfolio of 100GW by 2030. As the UAE prepares to host the UN climate change conference, COP28, with Dr Sultan as President-Designate, this achievement underscores the UAE's and Masdar's unwavering commitment to advancing decarbonisation and climate finance worldwide.

HE Dr Sultan Al Jaber expressed, "This marks a pivotal moment for both Masdar and climate finance, and we take immense pride in our presence on the global stage during this historic market opening. The demand for green bonds is exceptionally high, and these funds will facilitate investments in renewable energy projects, particularly in developing economies and climate-sensitive nations.

"Yet, there is more work to be done to unlock finance for the energy transition required to triple global renewable energy capacity by 2030. The successful issuance of Masdar green bonds will play a pivotal role in advancing this goal by channelling funds to where they are most needed."

Mohamed Jameel Al Ramahi, CEO of Masdar, celebrated the success of Masdar's debut green bond issuance, emphasising the dedication of those who have contributed to Masdar's growth as one of the world's premier renewable energy companies over the past 17 years.

This accomplishment follows the introduction of their innovative Green Bonds Framework in March 2023, which received the highest Sustainability Quality Score of 'SQS1' from Moody's Investors Service, serving as part of a comprehensive initiative to fund their ambitious expansion plans.

Julia Hoggett, CEO of LSE plc and Head of Equities, Capital Markets, LSEG, extended congratulations to Masdar for the successful listing of their inaugural green bond on the London Stock Exchange, which will facilitate support for renewable energy projects. LSE is proud to contribute to the acceleration of the low-carbon transition by providing access to capital for global companies, funds, and governments.

This green bond issuance is the initial step of a programme aiming to raise up to US$3 billion to fulfill Masdar's equity funding commitments for new renewable energy projects, both domestically and internationally.

This strategic move is aligned with Masdar's aspiration to expand its global portfolio to 100GW of capacity by 2030. Furthermore, Masdar plans to conduct a secondary listing of its green bond offering later in the year on the Abu Dhabi Securities Exchange (ADX), the second-largest market in the Gulf region.

Proceeds from all bond offerings within this programme will be directed towards the most environmentally friendly projects within the renewable sector, encompassing solar, wind, renewable power transmission and distribution infrastructure, as well as battery storage assets. A stringent set of ESG criteria will be in place to ensure the eligibility of projects.

Since its establishment in 2006, Masdar has emerged as a leading force in clean energy in the UAE. The company's global reach spans across 40 countries, with investments in a diversified portfolio of renewable energy projects totaling approximately 20 gigawatts (GW) of capacity. Masdar's ambitious target is to expand this capacity to at least 100 GW by 2030. Additionally, the company aims to produce 1 million tonnes per annum of green hydrogen by the same year.

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Source: Masdar

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