Masdar raises $1bn through second green bond issuance

The UAE’s clean energy powerhouse Masdar (Abu Dhabi Future Energy Company) has successfully raised $1bn through its second green bond issuance under its Green Finance Framework.

This comes one year after the company’s first successful issuance of $750m on the International Securities Market of the London Stock Exchange.

The new issuance, comprising dual tranches of $500m each with tenors of five and 10 years, offers coupons of 4.875 per cent and 5.25 per cent respectively.

Investor demand was strong, with the order book peaking at $4.6bn, representing an oversubscription rate of 4.6 times.

The final allocation was split, with 70 per cent going to international investors and 30 per cent to MENA investors.

Proceeds from this issuance will fund Masdar’s equity commitments to new greenfield projects, many of which are in developing economies, as the company works towards its goal of expanding its renewable energy portfolio to 100GW by 2030.

Masdar’s debut green bond allocation

Masdar’s 2023 Green Finance Report highlighted the allocation and impact of its debut green bond.

Projects funded through the $750m raised last year include those in emerging markets and the Global South, with a total nominal capacity of 3.7GW.

These projects are expected to mitigate 5.4 million tonnes of greenhouse gas emissions annually when fully operational.

In addition to the green bond programme, Masdar is also making significant acquisitions of operational companies in mature markets, injecting capital and expertise to substantially contribute to the global renewable energy capacity.

Mohamed Jameel Al Ramahi, CEO of Masdar, stated, “Following the successful launch of our first green bond in 2023, our second green bond issuance for $1bn underscores investor confidence in Masdar’s financial robustness and its sustainability credentials.

“The funds will be pivotal in advancing our ambitious portfolio of renewable energy projects, further cementing our role as a key player in supporting an equitable energy transition by increasing energy access in emerging markets and the Global South.”

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