CLI issues 1 billion yuan of 3.5% sustainability-linked bonds in China

CAPITALAND Investment : 9CI 0% (CLI) has raised one billion yuan (S$187.1 million) from its inaugural sustainability-linked bond issuance in China.

The bond was issued under CLI’s two-billion-yuan debt programme and comes with a three-year tenor, along with a fixed coupon rate of 3.5 per cent per annum.

It is tied to CLI’s target of lowering its energy consumption by at least 6 per cent at its properties in China by 2024 from 2019 as the base year, excluding energy consumption by tenants.

The fundraising exercise was 1.65 times subscribed upon garnering “strong demand from institutional investors”, said the asset manager on Wednesday (Mar 20).

This also marked the first sustainability-linked “panda” bond – or bonds issued and sold in China by a foreign issuer – by a Singapore company.

CLI said it views the bond issuance as an opportunity to access lower-cost yuan-denominated capital, and further expand its domestic channels, as well as investor base. 

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Puah Tze Shyang, chief executive of CLI (China), said the fundraising exercise enables CLI to diversify its capital sources and increase its financial flexibility, while also helping to mitigate foreign exchange fluctuations.

“The panda bond also integrates our financing efforts with CLI’s sustainability performance, demonstrating our focus on responsible growth”, he said.

The bond is rated “AAA” by China Chengxin International Credit Rating.

China International Capital was lead underwriter and bookrunner for the deal, while HSBC (China) was the joint lead underwriter and joint bookrunner.

Shares of CLI closed S$0.01 or 0.4 per cent lower at S$2.66 on Tuesday.