Environmental Finance's Bond Awards 2021

Sustainability bond of the year - corporate: Orange

Orange’s inaugural sustainability bond was a €500 million ($593.4 million) offering split between social and green projects.

The bond forms part of Orange’s ‘Engage 2025’ strategic plan, which it launched in 2019 and will see the group reinvent its operating model to be guided by social and environmental accountability.

Specifically, it has made two commitments: the first towards digital and social inclusion, and the second towards the fight against climate change. This first issue will see 40% of the proceeds allocated to digital and social inclusion projects and 60% to energy efficiency and circular economy projects.

The group’s Sustainability Financing Framework was reviewed by Vigeo Eiris (V.E), an affiliate of Moody’s, which confirmed it aligned with both the Green Bond Principles (GBP) and Sustainable Bond Principles (SBP). The bond itself attracted a final order book of €2.2 billion and a spread that tightened by 30 to 35 basis points from initial price talk (IPT).

“Orange's sustainability bond helps the company achieve its 2025 sustainability targets and is part of a comprehensive sustainability strategy. The use of proceeds’ focus on digital inclusion with processes to target underserved areas and populations makes this bond stand out, given the degree of potential impact. The comprehensive framework helps drive the top ranking,” commented one Environmental Finance Bond Awards judge.

“There was a good strategic plan underlying the issuance, great investor interest and alignment with the Green Bond Principles/Social Bond Principles,” added another.

Deal Highlights

Issuer: Orange
Size: €500 million ($593.4 million)
Maturity: 15 September 2029, 9 years
Coupon: 0.125%
Use of Proceeds: Finance or refinance eligible green (energy efficiency, renew able electricity, pollution prevention & control) and social (digital & social inclusion) projects
External Review: V.E
Lead managers: Banco Bilbao Vizcaya Argentaria, Crédit Agricole CIB, Credit Suisse, HSBC, ING, Natixis
Credit rating: BBB+/Baa1/BBB+ (S&P/Moody's/Fitch all stable)
Other highlights/notable features: First sustainability bond under its 'Engage 2025' strategic plan to reinvent Orange as a group guided by social and environmental accountability