Abu Dhabi’s TAQA lists $1.5bn dual-tranche bonds on ADX

TAQA, also known as Abu Dhabi National Energy Company, has listed a $1.5bn dual-tranche bond on the Abu Dhabi Securities Exchange (ADX), as the company is championing energy transition with ambitious decarbonisation targets.

The 10-year notes, sized at $1bn and maturing on April 24, 2033, were issued as green bond at a coupon rate of 4.696 per cent and the proceeds will be used to finance, refinance and invest in relevant eligible green projects.

The five-year notes, sized at $500m and maturing on January 24, 2029, were issued as conventional bonds at a coupon rate of 4.375 per cent and the proceeds from the issuance will be used for general corporate purposes.

“As a low-carbon power and water champion, we see green finance and decarbonisation projects as key growth opportunities for our business driven by local and international investors’ growing demand for credible green investments,” Jasim Husain Thabet, TAQA’s group CEO and managing director.

سوق أبوظبي للأوراق المالية يدرج سندات شركة (طاقة) بقيمة 1.5 مليار دولار أمريكي.
ويشمل هذه الإدراج أول سندات خضراء تصدرها شركة (طاقة)

ADX lists @TAQAGroup ‘s USD 1.5 Billion Dual Tranche Bond.
This listing includes the first green bonds issued by TAQA.
#ADX #TAQA #GreenBonds pic.twitter.com/CPV20soi8z

— سوق أبوظبي للأوراق المالية (@ADX_AE) September 7, 2023

The dual-tranche senior unsecured notes – which form part of TAQA’s Global Medium Term Note Programme – will now be listed on both ADX and the London Stock Exchange.

The Abu Dhabi bourse said the listing brings the overall debt instruments listed on the exchange to 44.

“TAQA’s sizeable secondary bond listing on ADX reflects our ongoing and successful efforts to increase the number of listings across our growing debt market,” said Abdulla Salem Alnuaimi, CEO of Abu Dhabi Securities Exchange.

The order book was nearly 10 times oversubscribed at the time of issuance in April, with regional and international investors placing total orders of more than $15bn. The notes are rated Aa3 by Moody’s and AA- by Fitch, in line with the company’s corporate credit rating.

TAQA’s green finance framework

Meanwhile, the company unveiled its green finance framework for the issuance of green bonds, Sukuks, loans and other debt instruments earlier in April.

The utility firm said proceeds from the issuances will be used to finance eligible green projects including renewable energy, energy efficiency, sustainable water and wastewater management as well as clean transportation, terrestrial and aquatic biodiversity.

TAQA said its green finance framework is aligned with the global best practice set out under the four core components of the Green Bond Principles 2021 that was published by the International Capital Market Association.

The financing framework was given a sustainability quality score of SQS2 (very good) – the second highest score under Moody’s Second Party Opinion (SPO) scoring framework, which means it demonstrates a significant contribution to sustainability.

The utility firm unveiled its 2030 ESG Strategy in October 2022 with interim greenhouse gas emissions reduction goals of 25 per cent of scope 1 and 2 emissions and a 33 per cent reduction of UAE portfolio emissions, with 2019 as the baseline.

TAQA aims to make renewables 30 per cent of its share of generation by that date, which it said had been accelerated by its acquisition of a 43 per cent stake in the renewables business of fellow Abu Dhabi-based company Masdar.

Read: UAE’s TAQA Group posts Dhs13.5bn in H1 net income