Burberry Group has priced its inaugural ‘Sustainability Bond’. This is the first sustainability bond issued by the luxury fashion company and will introduce long-term financing into the company’s capital structure. The proceeds from the bond will be used to finance and/or refinance eligible sustainable projects as described by Burberry’s Sustainability Bond Framework.
The bond is expected to be rated Baa2 by Moody’s Investors Services, and will be issued pursuant to Burberry’s Sustainability Bond Framework. The bond will be guaranteed by the Burberry group entities which also guarantee the £300 million Revolving Credit Facility. The Bond will be offered to professional investors and eligible counterparties. Applications will be made for the admission of the bond to be listed on the Official List of the UK Listing Authority and to be traded on the Main Market of the London Stock Exchange.
Burberry has a conservative capital allocation policy. Following the COVID-19 outbreak, it drew down its £300 million Revolving Credit Facility (the ‘RCF drawings’) and issued £300 million of short-dated commercial paper under the Bank of England’s COVID Commercial Financing Facility with a maturity in March 2021.