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Retail

REWE Group Places Sustainability-Linked Bond Issue

By Dayeeta Das
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REWE Group has placed a sustainability-linked bond (SLB) issue, with the repayment amount linked to sustainability goals achieved by REWE and Penny.

The bond, worth €900 million and extending over a term of seven years, will help the company to achieve its GHG emissions reduction goals throughout the entire supply chain and support the necessary investments, the company added.

REWE and Penny have committed to setting medium-term company-wide reduction targets in line with the net zero standards of the Science Based Targets initiative (SBTi).

'An Economic Factor'

Telerik Schischmanow, CFO of the REWE Group, said, "Commitment to sustainability is increasingly becoming an economic factor. We clearly see that investors and capital market partners have clear expectations here and view this commitment in a similar way to other key figures such as sales and earnings.

"Sustainability is not a luxury or the oft-quoted fig leaf. That's why we link our interest rate structure to our sustainability progress. The great trust of our investors gives us the financial flexibility to advance our growth and digitalisation course parallel to our strategic further development of sustainability."

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REWE Group received support for the bond issue from BNP Paribas, SEB, Société Générale and UniCredit.

Similar to the rating of the REWE Group, the SLB has also been given an instrument rating of BBB by S&P, the company added.

Sustainability-Linked Bond

In order to make the bond sustainable, the REWE Group has developed a so-called Sustainability-Linked Bond Framework, which connects the group's financing strategy with its sustainability strategy.

Dr Daniela Büchel, member of the REWE Group board responsible for human resources and sustainability, said, "Sustainability doesn’t come for free.

"With our debut, we are securing the necessary liquidity to achieve not only our demanding investment plans, but also our extremely ambitious sustainability goals. We will report annually on our progress."

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