For this type of loan, the interest is linked to Lenzing's performance in the area of sustainability and is annually reviewed and assessed by an independent sustainability agency. The MSCI agency, which undertakes the rating in Lenzing's case, recently awarded the company an A rating.
The initial €200 million bond was of such interest to investors from Europe and Asia that the decision was made to increase it to €500 million. Nearly 12 per cent of this ($65 million) was tendered in US dollars. The average interest rate of the loan is just under 1 per cent, through which the Lenzing Group is financed less expensively than with previous bonded loans. The fluctuation margin of the interest rate of +/- 2.5 base points rises or falls depending on Lenzing's sustainability rating. In the event of an improved rating, the relevant interest savings will be donated on the part of Lenzing.
The total volume of the loan of €500 million will be available to the Lenzing Group in December 2019 and in January 2020 and is further distributed over tranches with terms of five, seven and ten years. In addition, registered bonds will be put into place with a term of 15 years. The resources will be used for general corporate financing, for early refinancing of a bond tranche from 2015 and for important sustainable future projects by the Lenzing Group.
“Our bonded loan connects attractive conditions to an innovative sustainability-oriented concept. For this we've used the favourable interest environment and secured long-term financing. Sustainability is an important success factor of our corporate strategy. We are firmly convinced that sustainability represents an elementary factor for the economic success of the Lenzing Group,” said Thomas Obendrauf, chief financial officer of the Lenzing Group.
The transaction was arranged and structured by BNP Paribas, the Landesbank Baden-Württemberg and UniCredit. Parts of the bonded loan were tendered via the innovative digital platform Debtvision. Considering the strong interest by domestic and foreign investors, the initial starting volume of €200 million was oversubscribed multiple times.
The Lenzing Group stands for ecologically responsible production of specialty fibres made from the renewable raw material wood. As an innovation leader, Lenzing is a partner of global textile and nonwoven manufacturers and drives many new technological developments.
The Lenzing Group’s high-quality fibres form the basis for a variety of textile applications ranging from elegant ladies clothing to versatile denims and high-performance sports clothing. Due to their consistent high quality, their biodegradability and compostability Lenzing fibres are also highly suitable for hygiene products and agricultural applications.
The business model of the Lenzing Group goes far beyond that of a traditional fibre producer. Together with its customers and partners, Lenzing develops innovative products along the value chain, creating added value for consumers. The Lenzing Group strives for the efficient utilisation and processing of all raw materials and offers solutions to help redirect the textile sector towards a closed-loop economy.
Fibre2Fashion News Desk (PC)
Global Organic Textile Standard
‘GOTS is a very efficient supply chain management tool, especially for...
Online remains the best destination for shopping
‘There is huge demand in the Indian lingerie market for non-wired styles.’
Weko, Weitmann & Konrad GmbH & Co KG, based in south Germany, is...
Family-owned German textile machinery manufacturer Trützschler operates...
From the very beginning, Loris Bellini's aim was to produce dyeing...
Suominen Corporation is a manufacturer of nonwovens as roll goods for...
S Ziya Gumuser
Turkish nonwoven manufacturer Teknomelt has been around for only seven...
Nature Works LLC
Eamonn Tighe, Fibres and Nonwovens - Business Development Manager of...
Rupa Sood and Sharan Apparao
Nayaab, an exhibition meant to celebrate Indian weaves, is in its second...
She grew up in the walled city of Old Delhi, completed her studies, and...
Hemant & Nandita
Hemant & Nandita
The designer duo of Hemant & Nandita are known for being inspired by...