GLP, a global investment manager and business builder in logistics, real estate, infrastructure, finance and related technologies, on May 10 priced an upsized green subordinated capital securities amounting to US$850 million.
The Reg S perpetual non-call five offering was priced at par with a similar coupon and re-offer yield of 4.50%. This was in line with the final price guidance and 37.5bp tighter than the initial price range of 4.875% area. The issuance represented GLP’s return to the international public US dollar bond market after more than five years and marked the first-ever offering of US dollar green subordinated perpetual securities by a corporate issuer from Asia-Pacific. This was also the largest US dollar green subordinated perpetual offering globally to date.
In executing the transaction, the deal arrangers organized a series of fixed income investor calls across Asia and Europe commencing on May 5. The issuance was 6x oversubscribed from the initial target amount of US$500 million, enabling GLP to upsize the deal to US$850 million.
GLP global treasurer Edwin Tey says the offering reinforces GLP’s commitment to make sustainability a core component of the company’s business and follows the US$658 million sustainability-linked loan (SLL) that it completed in February this year. Proceeds from the SLL facility will be used to contribute to the company’s environmental objectives related to climate change mitigation and the promotion of green buildings.
Following the latest transaction, GLP and its strategic partners have now raised about US$2 billion in SLLs and green bonds globally. Notably, GLP J-Reit was the first logistics J-Reit to launch a green bond targeted at retail investors. In March this year, GLP J-Reit raised 5 billion yen (US$46 million) with the issuance of a 20-year sustainability bond – the first ultra-long sustainability bond in the J-Reit market.
The green subordinated perpetual securities are not callable for the first five years and there is a 25bp step-up margin from year 10, and an additional (cumulative) 75bp from year 25. Issued under GLP’s US$5 billion euro medium-term note programme, the securities will receive 50% equity credit from S&P Global Ratings (until year 5), Fitch Ratings and Moody’s Investors Service.
Proceeds from the green perpetual securities will be used to refinance eligible green projects in accordance to GLP’s green finance framework on which Sustainalytics has issued a second party opinion.
Citi, DBS, Deutsche Bank, Goldman Sachs and Mizuho Securities Asia were the joint bookrunners and lead managers for the offering.
GLP operates across Brazil, China, Europe, India, Japan, the Unied States and Vietnam, and has over US$100 billion in assets under management.