Amazon Issues First Sustainability Bond at $1 Billion
By Dieter Holger
Amazon.com Inc. issued its first sustainability bond at $1
billion to support environmental and social projects at the
e-commerce giant as investors clamor for more of the bonds to green
Seattle-based Amazon said Monday that its bond would raise funds
for renewable energy, affordable housing, cutting resources used by
buildings and helping underrepresented groups enter the technology
workforce through training. Amazon aims for net-zero greenhouse-gas
emissions across its direct and indirect activities by 2040 and has
rallied other big companies to target the same year.
An Amazon spokesperson said information on the bond's maturity
date and yield wasn't yet available. The bond doesn't have special
terms but Amazon has pledged to use the net proceeds for green or
social projects, though the breakdown of funding for each project
is also not yet available, the spokesperson said. Down the road,
companies often provide an update on how funds from green or
sustainable bonds were used.
Amazon ranks second among 18 publicly-traded e-commerce
companies for its management of environmental, social and
governance matters, including disclosures and programs, according
to The Wall Street Journal's ESG scores. EBay Inc. currently holds
the top spot in the e-commerce section of the rankings, which
update as more data becomes available.
Unlike green bonds that focus on climate change, sustainability
bonds are tied to both environmental and social efforts and have
gained in popularity in recent years. Investors who want to boost
the sustainability profile of their holdings tend to oversubscribe
to the bonds.
Late last month, home appliance maker Whirlpool Corp. said it
completed its first $300 million sustainability bond, a 10-year
note with an interest coupon of 2.4% per year.
Loans that reward or punish companies with higher or lower
borrowing costs if they meet self-made environmental and social
targets continue to attract more corporate borrowers who want to
put teeth behind their commitments. Beverage giant Anheuser-Busch
InBev SA signed a $10.1 billion sustainability-linked loan in
The growing number of net-zero pledges from companies are
expected to boost the sustainable-debt market to record levels,
analysts say. The global market hit $2.2 trillion during 2021's
first quarter and could surpass $3 trillion this year, according to
the Institute of International Finance.
In 2020, companies and governments issued a record $732.1
billion in sustainable debt including bonds and loans, a 29%
increase from 2019, according to BloombergNEF, a data provider.
Bookrunners for Amazon's sustainability bond are Goldman Sachs
Group Inc., Bank of America Corp., Wells Fargo & Co., Morgan
Stanley, HSBC Holdings PLC, JPMorgan Chase & Co., Citigroup
Inc., Societe Generale SA, Deutsche Bank AG and TD Securities, the
Amazon spokesperson said.
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(END) Dow Jones Newswires
May 10, 2021 18:14 ET (22:14 GMT)
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