Italy's Snam Launches €750mn Transition Bond

Italy's Snam has launched its third – and largest – transition bond in under a year, worth €750mn ($908mn), the gas grid operator reported February 8. The proceeds are to go towards investment in hydrogen and low-carbon operations.

The bond consists of two tranches of €500mn and €250mn, maturing on August 15 2025 and June 17 2030 respectively. The former has a 0% annual coupon rate with a reoffer price of 100.198%, while the latter has a 0.75% coupon rate with a 103.545% reoffer price. The placement was more than three times oversubscribed, Snam said, attracting high quality and geographically diverse institutional investors.

The notes will be listed on the Luxembourg stock exchange, with Banca IMI, BBVA, Barclays, BofA Merrill Lynch, Citi, Goldman Sachs, JP Morgan, Mediobanca – Banca di Credito Finanziario, Mizuho, Morgan Stanley and Societe Generale serving as bookrunners of the placement.

Snam, which pledged in November to achieve carbon neutrality by 2040, said the transition bonds were key for raising the share of financing it uses for sustainable investments to over 60% by 2024, from the current 40%. The company launched its first €500mn transition bond last June, followed by a second for €600mn in November.