Iberdrola issues a €600 million EU Green hybrid bond

Iberdrola has returned to the capital markets, this time to refinance a hybrid bond maturing at the end of April this year. The company has placed €600 million in green hybrid bonds, as reported to the Spanish National Securities Market Commission (CNMV). The bond, which by its hybrid nature is in principle perpetual, has a call option at par starting in December 2032.

The demand registered reflected the great interest of investors in Iberdrola, reaching more than €5 billion, with the participation of almost 280 qualified international investors, which allowed Iberdrola to significantly narrow the margin offered. The main geographical areas covered by the transaction are the United Kingdom (27%), France (24%), Germany (14%), Spain (10%), the Netherlands and Luxembourg (10%) and Italy (5%). 

Finally, with a book close to €2 billion, Iberdrola has managed to set the coupon at 3.95%, which is very competitive and below the theoretical benchmark based on the price of its bonds on the secondary market, achieving the lowest premium ever for a Spanish issuer. All of this highlights investors' strong appetite for Iberdrola's credit and their confidence in the Group chaired by Ignacio Galán, following the good results for the 2025 financial year presented yesterday, positioning it as best in class in the market.

The company has taken advantage of the market window that opened up after its results presentation, with costs at annual lows and in anticipation of a possible flood of competitive offers starting next week. 

Eight leading international banks participated in the placement: BNP, HSBC, Unicredit, BBVA, Santander, Natixis, SMBC and Commerzbank, which facilitated access to investors in a highly satisfactory manner.  

It should be noted that this is a green bond, which combines both the ICMA Green Bond Principles and the new European Green Bond Standard "EU Green", with more than 62% participation from sustainable investors.

The issue closed today by Iberdrola is its first public transaction on the market so far this year. This transaction will serve to refinance a transaction of the same type, which will be repurchased in the near future, thus maintaining the company's hybrid volume stable at €8.25 billion, as committed by the issuer at its recent Capital Markets Day in London. 

Hybrid bonds count as 50% capital, in accordance with the methodology of the main rating agencies, meaning that this transaction contributes to maintaining the group's credit ratings. Iberdrola's last issue of this type of debt was in November 2024 with a coupon of 4.247%.