Taqa Successfully Raises $1.5bn through Dual Tranche Bond Issuances, Including Debut $1bn Green Bond, Highlighting Strong Investor Demand for Green Investments

Abu Dhabi National Energy Company, commonly referred to as Taqa, has successfully raised $1.5 billion through dual tranche bond issuances, featuring a debut $1 billion green bond. The net proceeds from the green bond will be utilized to finance, refinance, and invest in green projects, while the conventional bond will be used for general corporate purposes. The green bond boasts a 10-year senior unsecured bond maturing in April 2033 and carries a coupon of 4.696%, while the five-year conventional tranche has a coupon rate of 4.375%.

Taqa received overwhelming interest from domestic, regional, and international investors, with the aggregate order book of both convention and green bond issuances reaching almost $15 billion. This reflects Taqa’s commitment to investing in green projects and achieving its ESG goals, highlighting the strong demand from investors for green investment opportunities.

Taqa’s Green Finance Framework for Green Bond Issuance

Earlier this month, Taqa unveiled its green finance framework for green bond issuance, which outlines the utilization of the proceeds from such deals to finance eligible green projects, including renewable energy, energy efficiency, sustainable water and wastewater management, clean transportation, and terrestrial and aquatic biodiversity. These projects align with Taqa’s 2030 environmental, social, and governance (ESG) targets and the company’s aim of achieving net zero by 2050. The 2030 ESG strategy includes interim greenhouse gas emission reduction goals.

Taqa’s Investment and Expansion

Taqa, a leading integrated utility company in the Europe, Middle East, and Africa region, has investments in power and water generation, transmission and distribution assets, as well as upstream and midstream oil and gas operations. The company’s assets are spread across various countries, including the UAE, Saudi Arabia, Canada, Ghana, India, Iraq, Morocco, Oman, the Netherlands, the UK, and the US.

In December, Taqa, Mubadala Investment Company, and Adnoc completed a deal to become shareholders in Abu Dhabi’s clean energy company Masdar, which will aid Taqa in achieving its 2030 target of having more than 30% of its generation portfolio come from renewables. Taqa has committed to a 25% reduction of scope 1 and 2 emissions by 2030 and expanding its share of renewables to at least 30% of total generation capacity by 2030.

Joint Lead Managers and Bookrunners

Taqa’s latest bond issuance was arranged and offered through a syndicate of joint lead managers and bookrunners, including BNP Paribas, Emirates NBD Capital, First Abu Dhabi Bank, HSBC, Industrial and Commercial Bank of China, IMI-Intesa Sanpaolo, Scotiabank, SMBC Nikko, and Standard Chartered.

Taqa’s CEO Comments

Jasim Thabet, Group Chief Executive and Managing Director, remarked, “Taqa has yet again achieved competitive funding in our latest bond offering, which has attracted strong demand from investors across several capital markets. Taqa’s clear ESG strategy and decarbonisation agenda has enabled us to complete our first-ever green bond … and allows us to cater to the growing demand for investors seeking credible green investment opportunities. In the Year of Sustainability, Taqa is demonstrating how utility companies can have ambitious growth targets and prioritize solid returns, while working towards a net-zero future.”

Taqa’s Financial Performance

Taqa’s latest bond issuance success adds to its impressive financial performance. The company’s net profit rose by 35% to Dh8.03 billion ($2.19 billion) in 2022, thanks to the surge in its oil and gas business amid rising commodity prices.

In conclusion, Taqa’s recent bond issuance, including the debut green bond, demonstrates the company’s strong commitment to investing in green projects and achieving its ESG goals. Taqa’s green finance framework, which outlines the utilization of proceeds from green bond issuances, further reinforces the company’s ESG commitments. With a solid financial performance and ambitious growth targets, Taqa is setting an example for utility companies that prioritize sustainable investments and a net-zero future.