Brazilian pulp and paper Suzano is negotiating a syndicated loan with an environmental, social and governance (ESG) component less than four months after issuing its first sustainability-linked bond, chief financial officer Marcelo Bacci said at an event hosted by LatinFinance on Thursday.
Bacci declined to say how much Suzano could borrow through the loan, but he said the company will likely make an announcement “very shortly.” The loan will include ESG performance targets like the sustainability-linked bonds that Suzano sold last year, he added.
“We went to the market with a deal of $750 million and we received more than $7 billion in demand. It was really amazing,” he said during the Latin America Capital Markets Summit.
Suzano issued $750 million worth of sustainability-linked bonds in September last year, pricing the 3.75% 2031 notes at 327 basis points over US Treasury bonds. It added $500 million to the 2031 bonds at 3.1% in November. Bank of America, BNP Paribas, Crédit Agricole, JPMorgan, Mizuho, Robobank and Scotiabank led the deal, while Goldman Sachs, Morgan Stanley, MUFG, Santander, and SMBC were passive bookrunners.
“There is latent demand, and we don’t have enough instruments in the market to meet it. That is a reflection that, although it is still a niche [in Brazil], it is a growing niche,” Bacci said.
According to Bacci, Suzano was pivotal in developing a market for green bonds and agricultural receivables certificates, or CRAs, for Brazilian companies in the domestic and international markets.
“When we look at what we have done over the years, we launched the first green bond about five years ago, we did the ESG-linked bond this year, and we are now in the process of preparing a sustainability-linked loan in the domestic market now,” he said. “There is an evolution in the market.”
Suzano issued its first green bonds in July 2016 with $500 million worth of 2026 bonds and printed its first CRAs in December 2016 with BRL1 billion (then $289 million) in 2025 securities.
LatinFinance’s Capital Markets Summit brought top regional government officials, chief financial officers and leading bankers and analysts together again for an annual outlook on economic and credit conditions. You can review the day’s agenda and a recording of the event via the links below.