Frankfurt am Main – On June 18, the machinery and plant manufacturer Dürr AG issued a Euro 200 million Sustainability Schuldschein. The special feature of this type of sustainable financing is that interest rate of the coupon is linked to Dürr Group's sustainability rating. The transaction was jointly-arranged and structured by ING and LBBW. Parts of the Schuldschein were subscribed via a digital platform. Dürr was advised by ING on the selection of a suitable sustainability rating agency.
"With this Sustainability Schuldschein Dürr AG has successfully entered the field of sustainable financing," says Klaus Pahle, Head of Schuldschein Desk at ING Germany. "I am convinced that this transaction will pave the way for many other companies".
Dürr is the first company worldwide to use this form of sustainable financing for the issuance of a Schuldschein. Prior to this, it had only been used occasionally for credit facilities. The average interest rate of the heavily oversubscribed Schuldschein is 0.84 %, which means that the Group is financing itself more cost-effectively than ever before. The total volume of Euro 200 million will flow to Dürr AG in July and will be divided into tranches with terms of five, six, eight and ten years. The proceeds will strengthen the group’s liquidity and will be used for long-term corporate financing. In addition, this Schuldschein serves as an early follow-up financing for the corporate bond of EUR 300 million with a coupon of 2.9 % that will expire in 2021.
The sustainability approach is specifically aimed at investors who value both financial performance and sustainable management. Thus, the interest rate of the coupon will fall or rise depending on whether the group's sustainability rating improves or deteriorates. The sustainability rating issued by EcoVadis considers, among others, ecological indicators such as CO2 emissions and water consumption. Further aspects such as fairness of business relationships and supplier conditions are also taken into account.
Given the strong interest shown by both domestic and foreign banks, the order book was oversubscribed multiple times.
About ING Wholesale Banking Germany
ING Wholesale Banking Germany comprises the corporate clients business of ING in Germany and is part of the ING Group’s worldwide Wholesale Banking network with offices in more than 40 countries. ING Wholesale Banking offers banking services for large, internationally operating corporate clients. In addition to traditional banking products such as Corporate Lending and Transaction Services, ING is a world leading name in structured & project financing concepts, complemented by capital market solutions. ING Wholesale Banking Germany has approximately 300 employees based in the headquarters Frankfurt am Main who were in charge of a credit volume of EUR 36 billion by the end of 2018.