Colbún prints green bonds for renewable energy investments
19 October 2021
Chilean electric company Colbún issued $600 million worth of 10-year green bonds on Thursday to fund investments in renewable energy projects, a source involved in the deal told LatinFinance.
The new 2032 notes carried a coupon of 3.15% and priced at 99.826 to yield 3.169%, or 165 basis points over US Treasury bonds, the source said.
Colbún had opened the deal with initial price talk around 200 basis points over US Treasury bonds before it set guidance at 170 basis points, plus or minus five basis points, and launched at 165 basis points, the source added.
The company received $2.45 billion in orders for the new notes with Citi, JPMorgan, Santander and Scotiabank as the joint bookrunners.
Fitch Ratings assigned the bonds a BBB+ rating with a stable outlook, saying Colbún's credit profile had improved on the back of higher sales. Fitch added that it expects Colbún to improve annual revenues to an average of $636 million from 2022 to 2024.
Colbún said in late September that it could sell cross-border bonds to help finance a $850 million project to build a 778 MW wind power project. It also said it could use proceeds from the $1.3 billion sale of its power line business along with $150 million in bank loans and a local bond sale for UF7 million ($256 million).
The company added that it had $790 million in cash available for the three-year project after selling 100% of its power transmission unit, Colbún Transmisión, to a group controlled by the Dutch pension fund APG in May.
The Santiago-based utility has a project pipeline with 3,100 MW in installed capacity under development, according to Fitch. Colbún is expected to invest $550 million in 2021, rising to a peak of $740 million in 2022 and returning to around $575 million in 2023, the rating agency said.
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