July 26, 2021

Iberdrola closes the placement of bonds for 200 million at 0% interest

Iberdrola has closed an accelerated placement of bonds in the Euromarket for an amount of 200 million euros and maturing in November 2022, at 0% interest, it reported this Friday to the National Securities Market Commission (CNMV).

This is the group’s fourth issue in the capital markets since the COVID-19 coronavirus crisis began, according to Iberdrola, which thus increases the initial amount announced on Thursday to 150 million due to high demand.

The annual cost to the company is fixed and, in this case, it is below -1%, including all the costs of the operation, with which it obtains savings compared to the standard bond market.

This placement has consisted of the extension of an existing issue and the annual coupon or interest remains at 0%.

The final return to be received by investors will be determined based on the evolution of the listed price of Iberdrola shares.

The new bonds, which will be listed on the Frankfurt Stock Exchange, incorporate an option for their holders whereby they will be able, from July 12, 2022 to October 3, 2022, to receive a cash payment as a settlement.

The amount of this payment will be determined based on the evolution of the share price, with a reference price of 8.4641 euros per share, adjusted for the dividends that are distributed.

The execution of this option will always have a cash payment as a counterpart, so Iberdrola will not issue new shares and the shareholders will not see their participation diluted in any case.

Iberdrola has contracted Barclays Bank Ireland (the entity directing this operation) to face the payments that may arise from the decision of the bondholders to execute the option, as well as to purchase a hedging option identical to the embedded option sold to investors in the bond.

The electricity company launched this Thursday in the Euromarket this issue of additional bonds referenced to the value of its shares for an initial amount of 150 million euros under the same conditions.

Thus, Iberdrola expands by 200 million the issuance of a structured bond carried out in November 2015 and linked to the share price, replicating its characteristics and in no case requiring the issuance of new shares of the company, so the participation of shareholders will not be diluted.

This operation is the lowest cost in Iberdrola’s history, according to the company.

The terms and conditions of the issue are the same as the bonds it issued on November 16, 2015, which earn an annual coupon of 0% and mature on November 11, 2022, as reported yesterday when it launched the issue.

Iberdrola intends to apply for admission to trading on the open market of the Frankfurt Stock Exchange (Freiverkehr) of the new additional bonds launched.


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