The issuer will use HUF 23 billion of the proceeds from the green bonds to make environmentally friendly investments over the next two years
Today, Baromfi-Coop Kft. successfully issued green bonds to a significant number of investors.The transaction was carried out under the Hungarian National Bank's Growth Bond Programme (NKP) and raised HUF 23 billion to finance green investments.A total of HUF 46.1 billion was offered for the 10-year bonds, with an average yield of HUF 2.7331%.
Moore Hungary Financial Advisory Kft. was the financial advisor responsible for the preparation of the information documents required for the issue, while Erste Bank Hungary Zrt. acted as the arranger and distributor.
The investments related to the green bond will be carried out between 2021-2023, and will enable Baromfi Coop Ltd. to achieve significant savings in water and energy use, reduce waste - partly through the recycling of by-products - and reduce ammonia emissions.
„The management's main mission is to achieve sustainable poultry meat production, with maximum protection of the natural resources used. Accordingly, the Group will set strict environmental targets for all future investments,” emphasized Péter Bárány, Managing Director of Baromfi Coop Kft.
The green bond issue was the second significant bond transaction for Baromfi-Coop in two years: in November 2019, also under the NKP, the company raised nearly HUF 30 billion, which was partly used for acquisitions, partly for new investments and partly to redeem previous loans.
Baromfi-Coop is a poultry farming company of the Master Good Group, 100% owned by the Bárány family. The Master Good Group currently provides around 40 percent of Hungary's chicken meat production. The majority of the group's consolidated turnover comes from domestic and EU sales, but exports to the UK and Canada are also significant. Its customers are mainly multinational retailers with excellent credit ratings, including Iceland Foods, TESCO-Global, Aldi, Spar and McDonald's main supplier OSI.
„The funds provided by the green bond on long-term, fixed terms open a new growth phase in the life of Baromfi-Coop,” added Gabriella Huth, Managing Partner of Moore Hungary, "Financing green and sustainable business operations of companies and protecting natural resources is of paramount importance today. That is why we were delighted to be involved in such a transaction, the size of which is also outstanding among the green bond issues launched last year."
„The outstanding investor interest in the Poultry Co-op bonds was a very important positive feedback for the issuer. Its business and strategic model, now complemented by green objectives, enjoys unbroken investor confidence, which has been reflected in a very favourable level of fundraising returns for the issuer”, said Kinga Oravecz, Head of Capital Markets Operations at Erste Bank.
„We have been involved in dozens of bond issues during the NRP, so we have a good overview of the domestic market. Based on this, I can say that there are very few companies in our country with such a well-prepared professional management and a mature and long-term strategy. It was therefore a particular pleasure to work with them on this issue.” - added András Kozma, Managing Director of Creditmanagement Group.
„Sustainable development is the challenge of our time. The environmentally conscious developments of the Poultry Coop Group are also serving this goal. We are glad that we could contribute to this fundraising with our work” - emphasized Tamás Szabó, Managing Director of Control Group Consulting Kft.
„The food industry is a particularly vulnerable sector from an environmental and sustainability point of view, just think of greenhouse gas emissions, water use, the ecological impact of production. The investments of the Baromfi-Coop Group are in support of a sustainable circular economy model, and the establishment of the Green Financing Framework is another milestone in the Hungarian green bond market. We are pleased that we can contribute our expertise to our client's business goals and, in turn, to the development of a more sustainable and greener economy,” said Katalin Döbrönte, Deputy Director of MKB Consulting's Strategic Consulting business.
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Moore Global, which started in a London office more than 110 years ago, is now one of the world's leading consulting and audit networks. Present in over 100 countries worldwide, the network has more than 600 independent offices and over 30,000 employees. The group's turnover for the last financial year exceeded $3 billion.
Moore Global's services will be directly available in the domestic market from March 2021. Moore Hungary has been offering a full range of consulting services in the fields of business, financial, tax, accounting and auditing with a team of almost 100 experts since its inception.
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