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LafargeHolcim launches first sustainability-linked bond for €850 million

Published by , Deputy Editor
World Cement,

LafargeHolcim has priced a €850 million sustainability-linked bond with a coupon of 0.5% maturing in 2031. With this first bond of its kind in the building materials industry, the company is confirming its sustainability leadership in the sector.

Géraldine Picaud, Chief Financial Officer: “We are proud to be the first in our industry to launch a sustainability-linked bond. The order book of €2.6 billion demonstrates the confidence of investors in the company’s financial strength, strategy and ability to deliver on its sustainability targets.”

Magali Anderson, Chief Sustainability Officer: “This announcement demonstrates the company’s commitment to reach the most ambitious CO2 reduction target of the industry for 2030. Today’s bond issuance brings our ESG related funding agreements to CHF 6 billion”.

Bond investors will be entitled to a higher coupon should the company not meet its objective, incentivising LafargeHolcim to reach its target of 475 kg net CO2 per t of cementitious material by 2030. LafargeHolcim reports on its performance against this key objective in its Sustainability Report which includes a limited assurance report by an external verifier.

ISS ESG, a leading ESG consultancy organisation, gave a second-party opinion validating the robustness and relevance of the company’s CO2 reduction target in the context of this bond. ISS ESG’s experts confirmed the alignment of LafargeHolcim’s Sustainability-Linked Financing Framework with the Sustainability-Linked Bond Principles, which are published by the International Capital Markets Association (ICMA).

LafargeHolcim is rated by ISS ESG #4 out of 95 companies in the same sector (C+, Prime), qualifying its bonds as responsible investment, and #1 out of 115 companies in the construction materials industry by Sustainalytics.

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