Global investment organization EQT announced today the pricing of two sustainability-linked bonds for a total of €1.5 billion, with interest linked to its portfolio companies’ sustainability targets.
Sustainability-linked securities are the fastest growing form of sustainable finance instruments, with attributes including interest payments tied to an issuer’s achievement of specific sustainability targets.
Christian Sinding, EQT CEO and Managing Partner, said
“We have an opportunity to drive transformation not only across our portfolio companies, but across the industries and societies in which we operate. This is what I and everyone at EQT work towards with respect, passion, and determination.”
For EQT’s new bonds, coupon rates will be linked to the company’s goal to have 40% of eligible EQT Funds’ equity portfolio companies having set science-based targets approved by the Science Based Targets initiative by 2025. If EQT’s target is not met, the bonds will see a step-up in interest rates.
Kim Henriksson, CFO, said:
“By linking EQT’s financing cost to sustainability performance targets, we create additional incentives for rapid implementation of Science Based Targets among the relevant portfolio companies. In addition, the sustainability-linked bonds will further diversify our funding sources. With long-term financing in place, we future-proof EQT’s financing structure in anticipation of the combination with BPEA and beyond.”