IFC picks up $56 million of Continuum Energy’s $561 million-green bonds

IFC picks up $56 million of Continuum Energy’s $561 million-green bonds

MUMBAI: The International Finance Corporation (IFC) has picked up 10 per cent of the first green bond issuance worth $561 million by Continuum Wind Energy as the anchor investor. The IFC has subscribed to 10 per cent or $56 million of Continuum Energy’s first green bond sale closed earlier this month, the World Bank Group member said.

On February 2, was the first to report that Continuum was in the market to raise $560 million via a six-year green bond issue. Finally, it closed the issue raising $561 million at a price of 4.5 per cent over the US treasury.

The bond, which had an order book of $3.2 billion, was rated BB+ by Fitch and Ba2 by Moody’s, and was listed on the Singapore Exchange on February 10.

The dollar-bond offering was heavily oversubscribed to almost seven times and the proceeds will primarily be used to refinance existing debt.

This investment will help Continuum maintain sustainable power generation and position it to deliver projects under development as the country emerges from the pandemic, said Isabel Chatterton, Regional Industry Director for Natural Resources and Infrastructure, Asia Pacific at IFC.

It will also help support India in its ambitions to reduce greenhouse gas emissions, at a time when private capital is most needed to fund infrastructure projects and support a green, resilient economic recovery, she added.

Continuum is one of the largest providers of renewable power to corporates in the commercial and industrial sectors, with roughly 2 GW of wind and solar projects across the country.

The company is majority-owned by the $4 billion global infrastructure fund managed by Morgan Stanley Infrastructure Partners.

IFC’s investment continues a relationship that began in 2014, when IFC financed Continuum’s development of a wind farm in Madhya Pradesh.

This offering enables us to further diversify our sources of funding, and we look forward to strengthening our partnership with global investors as we continue to build and grow our business, said Arvind Bansal, chief executive of Continuum.

Raja Parthasarathy, the managing director at Morgan Stanley Infrastructure Partners, said IFC’s anchor support for the Continuum’s maiden green bond issue validates the company’s strategy.

IFC is one of the largest financiers of climate-smart projects for developing countries and since 2005, it has invested $22.2 billion in long-term financing from its own funds and mobilised an additional $15.7 billion from other investors for climate-related projects.

In India, the IFC has 31-year history of investing in the power sector, committing $2.3 billion across 60 projects since 1989, of which 35 are renewable energy projects.

The city-based Continuum was founded in 2009 and since 2012, it is majority-owned by a fund managed by Morgan Stanley Infrastructure which focuses on long-term investments in infrastructure assets across the globe.

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