MTR raises A$2 bln in Australia's largest corporate green bond sale

MTR Corporation (0066) has issued its first Australian dollar-denominated senior unsecured green bonds, raising A$2 billion (HK$10.78 billion) in what the company said was the largest-ever corporate green bond and dual-tranche corporate bond offering in Australia's debt market.

The notes are in a dual-tranche transaction with a 5-year tranche of A$1 billion and a 12-year tranche of A$1 billion, with coupon rates set at 4.886 percent and 5.582 percent respectively.

Proceeds will be used to support eligible green projects as defined in MTR's Sustainable Finance Framework, promote environmental benefits and strengthen MTR's long term sustainability objectives, the company said.

Total investor demand reached A$12.5 billion, more than six times the amount on offer, marking the largest subscription volume for an Australian dollar corporate bond, MTR said.

The bonds were rated AA+ by S&P Global Ratings and Aa3 by Moody's.

The company said the positive market response to the bond underlines the market's confidence in MTR's outlook as a corporation committed to promoting sustainable development by delivering high-quality green transport services through the mass transit railway networks it operates and transit-oriented communities it builds.

"Investors include insurance companies, official institutions, pension funds, Sovereign Wealth Funds, asset managers, banks, securities houses, and private banks from around the world," said Michael Fitzgerald, finance director of MTR Corporation.

The transaction also further deepens the participation of Asian credits in the Australian dollar market, he added.

In Australia, MTR has established a presence since 2009 and now runs major rail franchises and metro systems in Melbourne and Sydney.