Chilean pulp and paper company CMPC started calling investors on Monday to pitch its first sustainability-linked bonds (SLBs) under new guidelines, a source involved in the deal said.
BNP Paribas, Bank of America, Goldman Sachs and JPMorgan will be the global coordinators and joint bookrunners in the sale of 10-year SLBs in US dollars, the source said. MUFG and Santander will be the other joint bookrunners, while BNP Paribas and JPMorgan will be the structuring agents, he added.
CMPC will issue the notes through the holding company Inversiones CMPC. It expects to receive a second-party opinion on its SLB framework from DNV, according to the source.
CMPC published the framework in March with targets and key performance indicators (KPIs) in two areas, greenhouse gas emissions and industrial water usage. According to the framework, the SLBs include a step-up margin or an additional payment if CMPC misses the sustainability targets in each issue.
In August last year, CMPC tied a $100 million revolving credit line from BNP Paribas and three other lenders to lowering greenhouse gas emissions, reducing water use, sending less waste to landfills and restoring land.
In 2019, the company took out a $100 million green loan from seven Japanese banks and issued UF2.5 million ($100 million) in green bonds in Chile. Softy’s Perú, a CMPC subsidiary, sold its first green bonds for $30 million in 2018 and CMPC itself issued its first green bonds for $500 million in 2017. CMPC sold $500 million worth of 10-year bonds for general corporate purposes in January 2020.