news - AEROPORTI DI ROMA
With this transaction, after having issued the first Sustainability-Linked Bond in the world of an airport operator in 2021 and its inaugural Green Bond in 2020, ADR confirms its sustainable development strategy with a share of "sustainable" debt that now exceeds 60% (a percentage that could further increase depending on the results of the Tender Offer).
The operation has encountered strong interest at an international level and from operators specialised in 'ESG' investments, with requests of almost five times the offer and total orders of around €1.9 billion, more than 95% of which can be attributed to foreign investors.
"This new issue - said Aeroporti di Roma CEO Marco Troncone - reaffirms the consistency between Aeroporti di Roma's commitment to sustainable development and its sustainable financing strategy. Launched for the first time in 2021 by ADR - as the world's leading airport operator - the sustainability-linked bond instrument reinforces the credibility and transparency profiles that must characterise the sector's environmental transition plans, and for this reason they will increasingly become an international reference. This will also be a guideline in support of our medium-long term development plan, to best combine environmental and social sustainability requirements with strengthening the competitiveness of a strategic sector for the country'.
The issue links the cost of debt to the achievement of specific sustainability targets (SPT) linked to Key Performance Indicators (KPIs) related to both the reduction of CO2 emissions controlled directly by ADR (Scope 1 and 2) and those dependent on third parties (Scope 3), as well as the maintenance of ACA4+ certification. On Scope 1 and 2, the plan envisages achieving zero net emissions in 2030, mainly through the construction of photovoltaic plants, the decarbonisation of the vehicle fleet through electrification or the use of biofuels, and the conversion of the cogeneration plant currently fuelled by methane. As far as Scope 3 is concerned, the sustainability target foresees a 30% reduction in 2030, compared to the 2019 baseline, of CO2 emissions per passenger mainly related to accessibility at Fiumicino airport, supporting the transition through the installation of more than 5,000 electric vehicle recharge points and enhancing the airport station capacity and intermodality. The certification, by SBTi (the "Science-Based Target initiative"), of the decarbonisation targets of the Mundys group, which as we know also includes ADR, is at a very advanced stage, and ADR will undertake to keep its framework updated with progressively increasing targets, including on scope 3.
The issue amounts to a total of €400 million, provides for repayment in a lump sum on 10 July 2033 and payment of an annual fixed-rate coupon of 4.875%. The issue price has been set at 99.119% and the effective yield to maturity is equal to 4.989%. The expected settlement date of the issue is 10 July. The bond issue will be listed on the Irish Stock Exchange. The bond is also expected to be assigned a rating in line with that of ADR ('Baa2' by Moody's, 'BBB' by S&P and 'BBB-' by Fitch).
In the event of failure to achieve one or more sustainability targets (SPTs) in the year of observation, a step-up on the coupon is envisaged starting from the coupon payable in July 2031 and up to maturity: specifically, step-up of 20 bps per year in the event of failure to achieve one SPT, (ii) step-up of 30 bps per year in the event of failure to achieve two SPTs or (iii) step-up of 40 bps per year in the event of failure to achieve all three SPTs.
The transaction was led by a syndicate of banks that included Banca Akros, Barclays, BNP Paribas CIB, BofA Securities, Crédit Agricole CIB, IMI-Intesa Sanpaolo, Mediobanca, Natixis, Santander, Société Generale and UniCredit (B&D) as joint bookrunners of the placement. Among them, BofA Securities and Crédit Agricole CIB also acted as sustainability structuring coordinators.
At the same time, a Tender Offer was launched aimed at holders of the €500,000,000 bond maturing on 8 June 2027, issued by ADR in 2017 under its EMTN Programme (ISIN Code XS1627947440). The maximum amount accepted will be defined and disclosed in accordance with the terms and conditions contained in the Tender Offer Memorandum dated 3 July 2023, subject to applicable offer and distribution restrictions.
Notice of the launch of the Tender Offer can be found at https://direct.euronext.com/#/rispublication. The results of the offer will be communicated to the market in the coming days. ADR will settle the full amount in cash.
For the Tender Offer transaction, the banks Barclays Bank Ireland PLC and BNP Paribas are acting as "Dealer Managers".
The documentation for the new issue and the Tender Offer was prepared with the support of the law firms Legance and White & Case.
With these two transactions, ADR continues its path of optimising its financial structure and improving the maturity profile of its debt, while increasing the weight of sustainable finance in its total sources of financing.
The placement also contributes to the broader path undertaken by ADR to drive the sustainable development of its airports, as well as the entire sector. The Group's commitment, in this sense, is also testified by the awards obtained in the field of sustainability, in addition to the highest international recognitions in the sector - such as the 5 stars from Skytrax and the Best European Airport Award from ACI (obtained 5 times in the last six years): among these, the certification of World's Most Sustainable Airport 2022, by UNWTO, and the most recent Most Sustainable Airport Award, just received in the framework of the World Finance Sustainability Awards 2023.