Hogan Lovells plays key role in Europe's sustainability-linked bonds

Hogan Lovells plays key role in Europe's sustainability-linked bonds

The law firm advised banks on Rexel's new sustainability-inked notes offering, one of the first of its kind in Europe

Global law firm Hogan Lovells has advised a syndicate of banks in connection with Europe's one of the first sustainability-linked high yield bonds offered by Rexel.

Rexel is a worldwide expert in the multichannel professional distribution of products and services for the energy world. It published its first Sustainability-Linked Bond Framework (the Framework) which covers debt instruments whose financial characteristics are linked with sustainability performance targets.

Under the Framework, Rexel selected two Key Performance Indicators and committed to achieve:

• a 23 per cent reduction in greenhouse gas emissions related to the consumption of products sold (part of scope 3), per thousand euro of turnover by 31 December 2023 from a 2016 baseline and

• a 23.7 per cent reduction in greenhouse gas emissions related to energy consumption in its operations (scopes 1 and 2) by 31 December 2023 from a 2016 baseline.

The interest rate of the Notes shall be increased by 25 basis points from 15 June 2024 if Rexel does not achieve these Sustainability Performance Targets.

"Our work on this matter demonstrates our ability to bring together our financing expertise and the specialist advice of our Impact Financing & Investing group to provide best-in-market support to our clients. We expect to see increased momentum behind investors engaging with financing linked to environmental and social targets going forward," Hogan Lovells' High Yield partner Sylvain Dhennin, who led the laws firm's team, said.

He was supported in the team by Senior Counsel and Co-Head of Impact Financing and Investing, Andrew Carey.

The team advised a syndicate of banks, comprising Crédit Agricole Corporate and Investment Bank (which also acted as Sustainability-Linked Bond Structuring Advisor), HSBC and Société Générale (as Joint Global Coordinators), Barclays and Wells Fargo (as Joint Bookrunners), and BBVA and Natixis (as Co-Lead Managers), in connection with the issuance of the €300 million unsecured sustainability-linked senior notes due 2028 by Rexel.