H&M Launches Inaugural Green Bond

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    Stockholm (NordSIP) – At the end of October, H&M Group issued a €500 million green bond with a maturity of 8 years under its Euro Medium Term Note (EMTN) programme and its Sustainable Finance Framework 2023.

    The green bond pays a 4.875% coupon and was priced at a 99.534 discount. According to the issuer, the bond generated significant interest from a broad international base of institutional investors and was more than 3.5 times oversubscribed.

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    The net proceeds from the bond will be allocated towards eligible projects in five categories as defined in the 2023 Sustainable Finance Framework: Circular Economy, Green Buildings, Renewable Energy, Energy Efficiency and Sustainable Water Management & Wastewater Management. According to S&P Global, which provided the Second Party Opinion, H&M Group’s Sustainable-Finance Framework is aligned with ICMA’s Green Bond Principles and Sustainability-Linked Bond Principlesm as well as with LMA/LSTA/APLMA Green Loan Principles and Sustainability-Linked Loan Principles.

    “We are pleased to have been able to attract strong demand for our inaugural green bond from a large number of international investors. The transaction extends H&M Group’s debt maturity profile and supports our vision to lead the change towards achieving a circular fashion industry with a net-zero climate impact. We are also happy to see a broadening of our investor base, including several leading green investors, which confirms the ambition of our sustainability agenda”, says Adam Karlsson, CFO, H&M Group.

    The bond will be listed on the regulated market Euronext Dublin and has been placed with the assistance of BNP Paribas, ING, J.P. Morgan, SEB and UniCredit. ING also acted as advisor for the Sustainable Finance Framework.

    In 2021, H&M had already entered the sustainable fixed-income market with a similarly-sized sustainability-linked bond (SLBs). In its Sustainable Finance Framework H&M explained its motivation for complementing SLBs with Green bonds. “By issuing a combination of green and sustainability-linked finance instruments, H&M Group seeks to maximise the connection between its funding and sustainability strategies, while highlighting the investments that we make today that have a positive impact in the environment and our future trajectory to support our decarbonisation goals and the transition to a circular economy.”

    Image courtesy of David Thunander/H&M
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