Cleary Gottlieb Steen & Hamilton has helped the French building materials giant Saint-Gobain bring home its first bond issue linked to the achievement of environmental, social and governance goals, the latest major financing in Europe in the burgeoning ESG bond market.
The €1.5 billion corporate bond issue, which closed earlier this month, includes €500 million in “sustainability-linked bonds,” Cleary said in a statement.
If Saint-Gobain “does not meet the objectives set for the key performance indicators under the conditions described in the terms and conditions of the bonds, the interest rate of the sustainability-linked bonds will be increased by 0.375% or 0.75% following the sustainability performance target date in 2030,” the statement said.
The company will use the net proceeds of the offering for general corporate purposes, Cleary said.
Cleary was the sole counsel on the deal, advising Société Générale as sole structuring advisor and global coordinator, and the global coordinators and joint active bookrunners, and acting as deal counsel.
The Cleary team was led by corporate and financial partner Valérie Lemaître in Paris and finance, capital markets and restructuring partner Jim Ho in London.
The global market for ESG-linked bonds has been propelled by new market regulation in the United States holding listed companies responsible for meeting sustainability standards.
The U.S. rules are having resonance with clients and regulators worldwide, from the European Union to Latin America.
In July, Herbert Smith Freehills and Allen & Overy advised Airbus on the issuance of €8 billion in sustainability-linked bonds, the second such bond issue for the European aerospace giant in two years.