ENGIE was able to attract strong demand from European investors, mainly asset managers, with a final order book oversubscribed more than 2 times. The Group will pay a coupon on these bonds of 1.625% p.a., which is amongst the lowest ever for this type of financial instruments.
Proceeds of the new issue will be used amongst others to finance a tender offer on the PerpNC2021 hybrid bonds that was launched concurrently, in line with ENGIE’s policy to dynamically manage its stock of hybrid instruments.
With this transaction, ENGIE reduces its hybrid coupon expenses (1.625% p.a. for the new PerpNC6 vs. 4.750% for the refinanced PerpNC2021), while at the same time partly anticipating its next hybrid call date and lengthening its debt maturity profile. Hybrid bonds issued by ENGIE benefit from a 50% equity content from the credit rating agencies.
Judith Hartmann, ENGIE Executive Vice President and Chief Financial Officer :
“ENGIE successfully returned to the hybrid bond market for the second time in 2019 and perfectly timed the launch of this new hybrid transaction, taking advantage of the historically favorable market conditions and confirming the attractiveness of ENGIE.”
In 2019, ENGIE placed in total EUR 1.5 billion of hybrid bonds.