EBRD supports GEK TERNA’s sustainability-linked bond

By Olga Aristeidou

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©GEK TERNA S.A., St. George island, Greece

  • €25 million participation in GEK TERNA S.A.’s €300 million sustainability-linked bond
  • EBRD investment to fund the company’s refinancing and working-capital needs
  • First sustainability-linked bond to be listed on Athens Stock Exchange

The European Bank for Reconstruction and Development (EBRD) is supporting the development and sustainability of the debt capital market in Greece, by investing €25 million in GEK TERNA’s seven-year sustainability-linked bond issue.

With a total issuance volume of €300 million, it is the first sustainability-linked bond to be listed on the Athens Stock Exchange to date. 

The issue will help GEK TERNA to finance its business activities in infrastructure, energy, industrial and real estate sectors, refinance existing and future debts and finance working capital needs.

The proceeds of the EBRD’s participation will be used exclusively for refinancing and working capital purposes.

The bond includes a sustainability performance target, which commits the company to reduce its CO2 emissions intensity by 25 per cent by the end of 2025 compared to 2021. Not meeting this target would lead to a 0.20 per cent increase in its coupon (the interest rate paid to bondholders).

GEK TERNA is the holding company for a group active in concessions, renewable energy, thermal energy and construction, incorporated in Greece and operating in Greece, central and south-eastern Europe and the Middle East.

The company is a long-standing partner of the EBRD. It plays a key role in Greece’s infrastructure and energy sector and will participate in various concessions and public-private partnership tenders, which are expected to result in significant investments.

To date, the EBRD has invested approximately €5.1 billion in more than 85 projects in the corporate, financial, energy and infrastructure sectors of the Greek economy. Last year, the Bank invested €57.5 million in GEK TERNA’s €500 million seven-year bond issue. In 2019, the Bank invested €18 million in a €150 million green bond issued by TERNA ENERGY, a member of GEK TERNA Group, while in 2018, it invested €15 million in GEK TERNA’s €120 million bond issue.

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