The issue will refinance existing hybrid capital securities, and supports Ørsted’s ambitious growth targets and commitment to focus strictly on green financing. 

Danske Bank has acted as joint lead manager and bookrunner on Ørsted’s 600m EUR hybrid green bond, a transaction that represents Ørsted’s second green hybrid bond issuance in EUR.

Investments undertaken by Ørsted in green renewable energy projects will be allocated to the new issue corresponding to the amount issued in accordance with Ørsted’s Green Finance Framework.

“Ørsted is an absolute frontrunner in developing sustainable solutions, and have managed to succeed in an impressive transformation from a business built on coal and oil to nearly solely green energy. We are extremely proud to take part in this transaction, and support Ørsted in their further growth journey,” says Jens Frederik Nielsen, Global Head of Corporate IG Origination at Danske Bank.

Great investor interest in hybrid bond

The green bond is a so-called hybrid, a bond type that mixes equity and debt. It was met with great investor demand with more than 230 investors in the order book that peaked at EUR 4.5bn, and included both Nordic and international investors.

“Ørsted is a well-known issuer in the capital markets showing great results, which partly explains the big interest. But the demand also tells us that investor interest in green investments and ESG in general is increasing day by day,” says Jens. 

“Danske Bank is fully committed to developing the market for sustainable finance, which will be a key area for our clients in the years to come. We are proud to build on our long-standing relation with Ørsted by taking part of this strategically important transaction,” adds Bo Wetterstein, Head of Corporate and Institutional Banking in Denmark.

A world that runs entirely on green energy

Ørsted has an ambitious vision of a world that runs entirely on green energy, and has furthermore made the decision that all future financing will come in a green format.

“From Ørsted’s side, we are very satisfied with the result achieved on our green hybrid bond issue. Focusing strictly on green financing is an integrated part of our financing strategy, which gives our Treasury and Sustainability departments an opportunity to work closely together. At the same time we believe green bonds bring a good deal of ‘tail wind’ from increasing investor interest and demand,” says Kasper Kiim Jensen, Head of Treasury at Ørsted.

What is a green bond? A green bond is generally defined as a fixed-income instrument, where the capital raised is earmarked for the financing of projects that benefit the environment or climate. Danske Bank works with both the issuer and investor side, and the overarching concept is referred to as “sustainable finance”.
Pricing details The EUR 600m 1,000 year non-call 8 year hybrid capital security was priced with a yield of 1.875% and a coupon of 1.75%. Danske Bank acted as a Joint Lead Manager alongside Citibank, J.P. Morgan and MUFG.