The operator’s first Sustainability Bond will finance social and green projects, as outlined in its strategy last December.
The five-year strategic plan, Engage 2025, said operator would invent its operational model to align with digital and social inclusion, and to combat climate change.
These commitments reflect Orange’s recent additions to its bylaws: “As a trusted partner, Orange gives everyone the keys to a responsible digital world”.
This issue was more than five times oversubscribed and allowed Orange to broaden its investor base and continue its policy of optimising its funding structure.
Priorities
Orange intends to allocate about 40% of this first bond issuance in digital and social inclusion projects and the rest in improving energy efficiency and promoting the circular economy.
Ramon Fernandez, Deputy CEO and Executive Director Finance, Performance and Development, said, “Our inaugural issue has attracted significant interest from socially responsible investors.
“As the Covid-19 crisis highlighted the essential nature of telecommunications, we feel necessary to drive our business with the objective to contribute to a more sustainable and fair world”.
How it is spent
The bond issue consists of a total nominal of €500 million, with a maturity of nine years and an annual coupon of 0.125%.
The projects selected and the allocation process will be overseen by Orange’s Sustainability Financing Committee.
Allocation of the proceeds will be annually audited until completed and investors will receive yearly updates on the impacts of their investments.
A precedent
Telefonica issued what it claims is was the first green bond to be issued by a telco in January 2019.