Woolworths (ASX:WOL) is set to issue EU $550 million ($880 million) in sustainably linked bonds, with a direct link to its sustainability goals of reducing carbon emissions.
The bonds will predominantly issued to institutional European investors, hence the euro pricing and includes a penalty if at the end of F26, scope 1 and 2 emissions targets are not met.
The supermarket giant hope to reach their reduction target by 2030, in line with the Paris agreement scenario of limiting global warming to 1.5 degrees.
Chief financial officer Stephen Harrison said, “the bond is directly linked to our emissions reduction performance and embeds financial incentives to drive meaningful change, in addition to the clear incentives to do so for the environment and our customers.”
Settlement is expected occur on 16 Sep this month. The funds from the bond will be used to establish long-term funding for the company recent investments in Quantium and PFD Food Services.
Shares in Woolworths (ASX:WOL) are trading 0.6 per cent lower at $39.57.
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