NEWS

Hyundai Heavy Industries (HHI) announced that it successfully sold green bonds worth US $100 million to overseas investors on March 21.

The company's first overseas sale of five-year green bonds has been two times oversubscribed by 42 institutions from Asia, the Middle East and Europe. Lead managers are Korea Development Bank (KDB), BNP Paribas, Hongkong and Shanghai Banking Corporation (HSBC) and Standard Chartered.

Guaranteed by KDB, the green bonds carry an interest rate equaling to the yield on five-year U.S. Treasuries plus a spread of 0.95 percentage point, which is 0.2 percentage point lower than HHI's original offer.

The raised fund will be used to finance the construction of eco-friendly vessels. As the shipbuilding industry recently shows signs of recovery, HHI plans to strengthen its investment in eco-friendly vessels and establish a system of sustainable growth based on environment, social and governance (ESG) management.

The company has strived to pursue ESG management over the past years. In June 2020, HHI signed a green loan contract worth $393 million, which is a loan instrument for eco-friendly projects. It also issued won-denominated green bonds worth about $260 million in March last year.

An official from HHI said, "Despite the fact that investor sentiment has worsened due to unstable geopolitical conditions and a U.S. rate hike, our ESG management activity has received positive responses from overseas investors. We will demonstrate our leading performance with strengthened eco-friendly technology."