London +4420 814 42225
Moscow +7495 543 9194
Kiev +38044 599 2950
info@mrcplast.com

Our Clients

Order Informer

 
Home > News >
 

BASF places chemical industry first green bond, anchors sustainability in its financing strategy

June 01/2020

MOSCOW (MRC) -- BASF says it has successfully issued corporate bonds with a total volume of EUR2.0 billion (USD2.28 billion) on the capital market, including its first-ever placement of a green bond that will be used purely to finance sustainable products and projects, according to Chemweek.

The green bond placement has a term of seven years ending June 2027, a volume of EUR1.0 billion, and an annual coupon of 0.25%, it says. The green bond is the first to be issued by a chemical company, a BASF spokesperson confirms to CW. The other tranche also had an issue volume of EUR1.0 billion, but with a term of three years ending June 2023 and an annual coupon of 0.101%, and will be used for general corporate financing purposes, BASF says. The company was able to secure attractive conditions "thanks to its very solid financial structure and its leading sustainability position," it adds.

"The strong demand from investors for BASF bonds underscores the capital markets confidence in our solid financial policies and our sustainability-driven corporate strategy," says Hans-Ulrich Engel, BASFs chief financial officer. "The initial issue of a green bond now firmly anchors sustainability in BASFs financing strategy as well," he says.

The company says it has established a framework for financing instruments based on sustainability criteria. The green finance framework will enable it to finance sustainable products or projects "offering a clear benefit to the environment and society" via green bonds on the capital market, and are fully aligned with BASFs corporate purpose, it says.

Environment, social, and governance (ESG) principles are now a major theme in publicly traded chemical companies discussions with investors. Tim Balensiefer, BASFs investor relations manager/sustainability, told CW in March that "financial markets recognize the opportunities of sustainable business approaches and investors are increasingly interested in sustainable business management. We can see a larger group of investors becoming more attached to the ideas of ESG investment."

As MRC reported earlier, BASF has recently announced the commercial launch of Fourtune which is a new Fluid Catalytic Cracking (FCC) catalyst product for gasoil feedstock. Fourtune is the latest product based on BASFs Multiple Framework Topology (MFT) technology. It has been optimized to deliver superior butylene over propylene selectivity while maintaining catalyst activity and performance.

We remind that BASF has restarted its No. 1 steam cracker following a maintenance turnaorund. Thus, the company resumed operations at the plant on September 30, 2019. The plant was shut for maintenance in mid-August, 2019. Located at Ludwigshafen in Germany, the No. 1 cracker has an ethylene production capacity of 235,000 mt/year and a propylene production capacity of 125,000 mt/year.

Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).

According to MRC's ScanPlast report, Russia's estimated PE consumption totalled 557,060 tonnes in the first three month of 2020, up by 7% year on year. High density polyethylene (HDPE) and linear low density polyethylene (LLDPE) shipments rose because of the increased capacity utilisation at ZapSibNeftekhim. Demand for LDPE subsided. At the same time, PP shipments to the Russian market was 267,630 tonnes in January-March 2020, down 20% year on year. Homopolymer PP and PP block copolymers accounted for the main decrease in imports.

BASF is the leading chemical company. It produces a wide range of chemicals, for example solvents, amines, resins, glues, electronic-grade chemicals, industrial gases, basic petrochemicals and inorganic chemicals. The most important customers for this segment are the pharmaceutical, construction, textile and automotive industries. BASF generated sales of EUR59 billion in 2019.


mrcplast.com
Author:Margaret Volkova
Tags:PP, PE, crude and gaz condensate, PP block copolymer, homopolymer PP, propylene, LDPE, HDPE, ethylene, petrochemistry, BASF, Germany, Rossiya.
Category:General News
|
| More

Leave a comment

MRC help

 


 All News   News subscribe