SFL Corp has scooped $150m out of the Oslo bond market with the placement of debt securities tied to sustainability goals.
The New York and Oslo-listed shipowner and lessor said the sustainability-linked bonds have a coupon of 8.25% per year.
A brief announcement did not explain the green features of the bond, but its previous bonds provide investors with a 0.5% premium if the company misses sustainability targets, according to a prospectus for that offering.
“It is not unexpected. We are a repeat issuer,” chief executive Ole Hjertaker told TradeWinds.
“We are very comfortable that we will reach the sustainability targets.
“We work with large logistics companies such as Maersk and Hapag-Lloyd. The clients and we have an incentive to make sure that our fleet is continuously improved.”
The latest bonds, which will be listed on the Oslo Stock Exchange, mature in four years.
SFL said it plans to use the proceeds from its latest deal to refinance existing bonds and for general corporate purposes.
“This is a part of our ongoing operations. This one will mature in 2028, so then we will have bonds with a smooth maturity schedule,” Hjertaker said.
The company has a series of bonds that mature in June, with NOK 695m ($64.9m) still outstanding.
An application will be made for the bonds to be listed on the Oslo Stock Exchange.
Investment banks Arctic Securities and DNB Markets acted as joint bookrunners on the deal, while co-managers were Fearnley Securities, Pareto Securities, SEB and SMBC Nikko.
The bond deal was closed three days after SFL announced that it tapped Arctic and DNB to arrange a series of meetings with fixed-income investors, with a view towards a US dollar-denominated bond.
At the end of 2023, SFL’s balance sheet showed nearly $2.07bn in long-term, interest-bearing debt.
The company owns a fleet of tankers, bulkers, container vessels, car carriers and offshore drilling rigs.
