Greenko Prepares To Raise $1 Billion Through Green Bonds
Greenko Energy started road shows on Monday.
A subsidiary of Greenko Energy Holdings, one of India’s largest clean energy companies, is preparing to raise close to $1 billion through so-called green bonds, said two bankers familiar with the issue. The company started road shows on Monday and may price the bond issue later this week, they said.
Green bonds are debt securities raised specifically for the purpose of financing clean energy projects. The proceeds from such issues are typically set aside in an escrow account to ensure their use is restricted to renewable energy projects. Green bonds attract a wider set of investors, many of whom have a specific mandate to invest in clean energy projects.
Greenko’s bond issue, if concluded successfully, would be the largest green bond to be issued out of India.
The proposed bond issue will be raised through Greenko Dutch BV, a special purpose vehicle. The notes will be guaranteed by the holding company, Greenko Energy Holdings (GEH). Singapore’s sovereign wealth fund GIC owns 64 percent in GEH.
Rating agency Moody’s has rated the bond issue Ba2 with a stable outlook, it said in a note issued on Monday. The rating is supported by the portfolio diversity of the entity raising funds, said Moody’s while adding the portfolio includes 1.1 GW of operating assets across wind, solar and hydro technologies in six states in India.
The funds raised through the dollar bonds will used by Greenko Dutch BV to invest in rupee-denominated bonds issued by a restricted group of subsidiaries of GEH, Moody’s said.
Fitch, in its rating note, said that Greenko intends to use the proceeds from the bond issue to refinance existing borrowings of $550 million. The balance of the proceeds will be used mainly to refinance existing debt at new operating entities within the restricted group, which will add to operational capacity.
Greenko Energy Holdings did not immediately respond to an email sent by BloombergQuint.