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ESG bonds

Hanwha Solutions to raise 1 billion yuan in ESG bonds

Apr 15, 2021 (Gmt+09:00)

(Courtesy of Hanwha Q CELLS, a solar energy unit of Hanwha Solutions)
(Courtesy of Hanwha Q CELLS, a solar energy unit of Hanwha Solutions)

South Korea’s leading renewable energy company Hanwha Solutions Corp. plans to raise 1 billion Chinese yuan ($153 million) this month in green bonds to strengthen business operations in solar and hydrogen energy segments.

According to the company on Apr. 15, it will issue three-year, yuan-denominated bonds on Apr. 19 with a yield of 3% per annum. All of the bonds will be sold to institutional investors in Asia and Europe, said Hanwha Solutions.  

Green bonds are special-purpose bonds issued to raise funds for eco-friendly initiatives such as renewable energy or electric vehicle projects.

Prior to the bond issuance, Hanwha Solutions received a positive second party opinion (SPO), an assessment of the issuer’s green bond framework, from the global ESG research and rating provider Sustainalytics last month.

Two third-party institutions -- Credit Guarantee and Investment Facility (CGIF), the trust fund of the Asian Development Bank (ADB), and South Korea’s state-run Export-Import Bank of Korea (EXIM) – will each guarantee 50% of the issued bonds.

The bonds will be issued with an AA rating from S&P.

Hanwha Solutions said that it will expand business activities in renewable energy segments including solar and hydrogen by investing around 1 trillion won ($895 million) of funds raised from the recent rights offering and the green bond issuance.

Specifically, the company will increase investment on research and development of next-generation solar cell materials such as perovskite. Overseas solar power plant development, construction and sellout activities will also continue in Europe and the US, according to the company.

In the hydrogen segment, Hanwha Solutions will expand investment to develop water electrolysis technology used to produce hydrogen and seek M&A opportunities in hydrogen tank businesses, like its acquisition of Cimarron Composites LLC last December.  

Write to Jae-Kwang Ahn at ahnjk@hankyung.com

Daniel Cho edited this article.

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