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(Bloomberg) –
Volkswagen AG makes its green bond debut, about two weeks after Daimler AG, when automakers call on socially guilty investors to pay for the incredibly expensive transfer to electric vehicles.
Car manufacturer VW and Audi are delivering two Eurobonds with maturity at 8 and 12 years, according to a user close to the offer, who asked to be known because they have permission to communicate about it. The company, which is one of Europe’s largest lenders, brought a green financing framework in March, as coronavirus disruptions closed bond markets.
VW’s first green bond sale, along with the EUROPEAN Union’s massive issuance plans, is helping to further boost the environmental debt market by adding more length and variety to a historically governed sector through banks, utilities and governments. investors’ growing appetite for green bonds, i. e. new issuers, which has helped Daimler and Germany assess recent sales since its inception at a value lower than classic offerings.
“The demand for green assets is huge,” said Michael Kobel, portfolio manager at Union Investment in Germany. “In terms of diversification and more investment opportunities, I see a growing number of issuers. “
VW plans to use an eco-budget to fund electric vehicle and charging station projects as it seeks to challenge Tesla Inc. Renault SA in the fast-growing battery-growing car market. The company aims to introduce around 75 new models of electric cars until 2029. in line with its green funding framework. Efforts have been hampered by software disruptions in the identification model. 3 The company has also experienced a recent wave of control disorders.
The automaker first markets the 12-year stretch of its 190-point basic agreement on 195 basic problems above intermediate exchanges, the user said. The company did not respond without delay to a request for comment via Bloomberg News’ email about the sale.
READ MORE: VW EUR BMARK; 8Y Green MS 170a, 12Y Green MS 190/195
Mercedes-Benz manufacturer Daimler probably stored more than 1. 3 million euros a year in loan prices by promoting a green bond from a traditional ticket, based on Bloomberg calculations. The 10-year green bond for one billion euros was priced at more than thirteen tighter base issues than its traditional liquid spread curve, according to Bloomberg BVAL on 3 September.
Borrowers have syndicated the roughly € 64 billion of green bonds in Europe this year, according to knowledge compiled through Bloomberg. The tally is approaching a total of € 70 billion in 2019, even after a coronavirus market shutdown earlier in the year. .
Banco Bilbao Vizcaya Argentaria SA, Commerzbank AG, HSBC Holdings Plc, ING Groep NV and Societe Generale SA are executing the agreement, depending on the person.
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