Novelis senior green notes: Novelis to offer $595-mn Euro-denominated senior green notes
The €500 million in aggregate principal amount notes will be offered in a private offering, the company said in a press statement on Monday.
The senior green notes are said to be guaranteed by Novelis Inc and by certain Novelis subsidiaries in Germany.
Moody’s Investors Service has assigned a B1 senior unsecured rating to the proposed senior unsecured green notes due in 2029.
Proceeds from the issue will be used to repay a portion of the $1.7 billion term loan and to allocate an amount equal to the net proceeds to finance the development of the eligible green projects, which include renewable energy investments, pollution, prevention and control expenditures and other sustainability-focused initiatives.
Novelis intends to use the net proceeds of the offering, together with cash on hand, to repay a portion of its outstanding $1.8 billion of term loans.
“In addition, Novelis intends to allocate an amount equal to the net proceeds received from the offering to finance and/or refinance new or existing eligible green projects,” the company said.
As of the third quarter of 2020-21 ended in December, Novelis had a free cash flow from continuing operations of $331 million as against $61 million a year earlier, driven primarily by higher adjusted Ebitda, favourable working capital and lower capital expenditures.
The company’s adjusted earnings before interest, taxes, depreciation and amortisation stood at $501 million, up 46% year-on-year.
As per the Securities Act, the green notes have not and will not be offered or sold within the United States or to US persons, except to qualified institutional buyers in reliance on the exemption from registration.
In August 2020, Novelis had raised up to $600 million by selling bonds to overseas investors to help fund the acquisition of Aleris.
Novelis Inc reported a net income attributable to its common shareholder of $176 million in the third quarter of the fiscal year 2021, up 64% versus the previous year.
