Evonik Industries AG has successfully issued a green hybrid bond with a nominal volume of €500 million and a coupon of 4.25%. This marks the company’s fourth consecutive green bond issuance, reinforcing its long-term commitment to sustainability and financial resilience.
A Strategic Move Towards Long-Term Capital Stability
The newly issued hybrid bond carries a formal maturity of 30 years and includes a first redemption option in 2031. With this issuance, Evonik reaffirms its strategy to maintain hybrid capital as a permanent part of its financial structure. In parallel, the company launched a tender offer to refinance its existing green hybrid bond, which has a first redemption right in 2026.
Investment-Grade Ratings Reflect Financial Strength
Thanks to Moody’s revised rating methodology, the bond received an investment-grade rating of Baa3—just one notch below Evonik’s corporate rating of Baa2 (positive outlook). Meanwhile, S&P assigned the bond a BBB- rating. These ratings indicate strong market confidence in Evonik’s financial health and sustainability agenda.
Alignment with Green Finance Framework
The bond issuance aligns with Evonik’s Green Finance Framework, updated in 2023, and follows the ICMA Green Bond Principles. As per Evonik, the framework received an external Second Party Opinion from ISS, confirming its credibility in guiding sustainable investment.
Proceeds to Support Sustainable Innovations
Evonik will primarily use the proceeds to fund its “Next Generation Solutions” and “Next Generation Technologies.” These initiatives focus on sustainable innovation in areas like circular economy, biosolutions, and clean energy. For example, the company is advancing biofunctional actives such as skin-identical ceramides, green hydrogen membranes, and omega-3 fatty acids derived from microalgae as a renewable alternative to fish-based sources.
By 2030, Evonik aims to generate 50% of its sales from these Next Generation Solutions, up from 45% projected in 2024.
Commitment to Reducing Environmental Footprint
In parallel, Evonik continues to lower its own ecological footprint through investments in its production processes. Under its Next Generation Technologies program, the company is developing projects like the climate-neutral production of alkoxides in Singapore—further evidence of its commitment to sustainability across the value chain.
Strong Market Reception from ESG-Focused Investors
The bond received overwhelming interest from institutional investors, particularly those with a focus on sustainability. This strong demand led to a significant oversubscription of the issuance.
Lead Financial Institutions
BofA Securities acted as the hybrid structuring agent and global coordinator. Barclays and ING also served as global coordinators, with Commerzbank, Deutsche Bank, DZ Bank, and LBBW participating as joint bookrunners.
