Philips issues inaugural Green Innovation Bond
May 15, 2019 Amsterdam, the Netherlands
– Royal Philips (NYSE: PHG, AEX: PHIA) (NYSE: PHG, AEX:
PHIA), a global leader in health technology, today announced the
successful pricing of its issuance of EUR 750 million 0.500% Green
Innovation Bonds due 2026. This inaugural Green Innovation Bond was
created by Philips in collaboration with Rabobank as Sustainability
Structuring Advisor. The transaction was further supported by the
Joint Lead Managers ABN AMRO, BNP Paribas, Deutsche Bank, HSBC,
ING, Mizuho Securities, MUFG, Rabobank and UBS Investment Bank.
As part of Philips’ commitment to make the world healthier and
more sustainable through innovation, the company has a
comprehensive sustainability strategy that includes its products,
solutions and business models, energy consumption, supply chains
and financial instruments.
In 2017, Philips was one of the first companies to develop a
Revolving Credit Facility with an interest rate linked to its
sustainability performance. As a next step, together with Rabobank,
the company has now developed the Philips Green &
Sustainability Innovation Bond Framework, under which it can issue
Green and/or Sustainability Innovation Bonds as a means to finance
its sustainability activities. Today’s issuance is the first bond
issued under this framework.
“Philips is a pioneer in advancing sustainability in all areas
of its business, and issuing this inaugural Green Innovation Bond
is a good example of that,” said Abhijit Bhattacharya, CFO of Royal
Philips. “The proceeds of this bond will be used as an alternative
means to finance our expenditures on green innovation, the
transition to the circular economy, and becoming carbon neutral,
for which we have set clear targets.”
“Philips and Rabobank are both at the forefront in
sustainability and innovation of their respective industries,” said
Wiebe Draijer, CEO of Rabobank. “This transaction is another
testament of how corporate and financial leaders are moving ahead
in achieving the United Nations Sustainable Development Goals and
leaving a better world for generations to come.”
The net proceeds will be allocated to a portfolio of eligible
green innovations, which belong to the following categories: (i)
expenditures regarding Green Innovation in R&D; (ii)
expenditures regarding the implementation of circular products and
solutions; and/or (iii) expenditures under the Group’s ‘Sustainable
Operations Programs’, as further described in the Framework,
available on
https://www.philips.com/a-w/about/investor/debt-info.html. In the
last two years, Philips spent around EUR 230 million annually on
Green Innovation [1].
The issue price for the notes due 2026 is 99.494% with a coupon
of 0.500%, resulting in a yield of 0.574%.
Settlement and issue of the Notes is scheduled for 22 May 2019.
Application has been made for the Notes to be listed on the
Official List of the Luxembourg Stock Exchange and to trading on
the regulated market of the Luxembourg Stock Exchange. Application
has also been made for the Notes to be displayed on the Luxembourg
Green Exchange.
Philips is committed to a strong investment grade credit rating.
Currently, the company has a BBB+ rating (with stable outlook) by
Standard & Poor's, a Baa1 rating (with stable outlook) by
Moody's and an A- rating (with stable outlook) by Fitch.
[1] Green Innovation is the Research & Development spend
related to the development of new generations of Green Products and
Solutions and Green Technologies. As disclosed in Philips’ Annual
Reports, the company spent EUR 233 million and EUR 228 million on
Green Innovation in 2017 and 2018 respectively.
For further information, please
contact:
Ben ZwirsPhilips Group Press OfficeTel.: +31 6 1521 3446E-mail:
ben.zwirs@philips.com
Ksenija Gonciarenko Philips Investor RelationsTel.: +31 20
5977055E-mail: ksenija.gonciarenko@philips.com
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About Royal PhilipsRoyal Philips (NYSE: PHG,
AEX: PHIA) is a leading health technology company focused on
improving people's health and enabling better outcomes across the
health continuum from healthy living and prevention, to diagnosis,
treatment and home care. Philips leverages advanced technology and
deep clinical and consumer insights to deliver integrated
solutions. Headquartered in the Netherlands, the company is a
leader in diagnostic imaging, image-guided therapy, patient
monitoring and health informatics, as well as in consumer health
and home care. Philips generated 2018 sales of EUR 18.1 billion and
employs approximately 77,000 employees with sales and services in
more than 100 countries. News about Philips can be found at
www.philips.com/newscenter.
Forward-looking statements This release
contains certain forward-looking statements with respect to the
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