Iberdrola has launched a €400 million green bond indexed to its share price, maturing in five years with a 1.5% coupon. This structured bond allows investors to benefit from the company’s stock performance, offering a call option on Iberdrola shares during the final three months before maturity. However, Iberdrola will not issue or deliver shares, ensuring no dilution for existing shareholders.
To hedge against potential liabilities from share price appreciation, Iberdrola will purchase a corresponding option, mitigating risk and securing cost advantages over traditional financing. The pricing level for this hedge will be determined in the coming days.
The transaction was executed with four major international banks—JP Morgan, Natixis, Mizuho, and Morgan Stanley. This is not Iberdrola’s first venture into structured bonds linked to its stock. The company previously issued a similar €450 million green bond in 2022 and entered the market in 2015 with a €500 million transaction, later increasing it by €200 million in 2020.
