John Fredriksen-controlled shipowner SFL Corp has announced the hiring of three investment banks to sell the company's first sustainability-linked bonds.
The move comes after TradeWinds reported that the New York and Oslo-listed shipowner was contemplating the bond move.
SFL said it mandated DNB Markets, the investment banking arm of Norway's DNB, to act as joint bookrunner and sustainability structuring advisor on the deal.
The company, which owns a diversified fleet focused on long-term charters, also tapped Arctic Securities and Pareto Securities to serve as bookrunners.
Oslo-headquartered SFL said the investment banks will arrange a series of calls with fixed-income investors.
The shipowner aims to issue five-year senior secure bonds, depending on market conditions.
The cash raised will be used to refinance existing bonds and to pay for general corporate purposes.
Other details of the contemplated bonds were not released.
ESG investors
Sources said the move is aimed at the growing pool of investors focused on environmental, social and governance (ESG) criteria, as TradeWinds reported.
But when talk of the bond effort first emerged, SFL chief executive Ole Hjertaker dismissed the reports.
“That’s just speculation,” he told TradeWinds on Friday. “We are looking at all options from our side. … We are opportunistic.”
The move comes as a small, but growing number of shipowners have tapped into ESG financing following strong fund inflows in recent quarters.
In January, Oslo-listed Odfjell claimed it was the first shipping company to sell a sustainability-linked bond in a NOK 850m ($100m) deal.
The chemical tanker company said it was also the first firm in the Nordic region to issue this kind of debt.
Earlier this month, containership owner Seaspan Corp raised $300m from its second sustainability-linked bond issue in the Nordic bond market.
The company, a subsidiary of New York-listed Atlas Corp, sold senior unsecured bonds that will mature in April 2026 and bear interest at 6.5% per annum.
Sustainability-linked bonds generally follow the principles issued by International Capital Market Association, and issuers’ financing costs are linked to their ESG performances.
In its latest annual ESG report, SFL said it will establish specific targets for several United Nations Sustainable Development Goals and develop its decarbonisation strategy this year.
