Leading building materials company Holcim announced today the launch of two sustainability-linked bonds, raising a total of CHF 425 million ($465 million), and tying the debt costs on the offering to the company’s climate goals. The offering marked the first sustainability-linked bond issue in the Swiss franc market.
The two bonds raised CHF 325 million and CHF 100 million, with maturities in 2026 and 2032 respectively at a cost of 0.35% and 0.90% per annum.
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. Last year, Holcim became the first company in the building materials industry to launch a sustainability-linked bond, with an €850 million offering tied to the company’s target to reach 475 kg net CO2 per ton of cementitious material by 2030.
Holcim stated that today’s announcement also marks a significant step for the company’s commitment to reach 40% of sustainable financing by 2024, as part of its growth strategy “Strategy 2025 – Accelerating Green Growth”, with key drivers including accelerating growth through innovative building solutions.
Géraldine Picaud, Holcim CFO, said:
“We are proud to be the first company to launch a sustainability-linked bond on the Swiss franc market. The bond attracted new ESG investors, demonstrating their confidence in Holcim’s financial strength, strategy, and ability to deliver our sustainability targets.”