Burberry Group plc (‘Burberry’ or the ‘Company’) is pleased to announce that it has now priced its inaugural Sustainability Bond. The final terms are for a £300,000,000 1.125% bond due 21 September 2025.
This will be the first sustainability labelled bond issued by a luxury fashion company and will diversify Burberry’s sources of funding, introducing long-term financing into the Company’s capital structure. The proceeds will be used to finance and/or refinance eligible sustainable projects as described by Burberry’s Sustainability Bond Framework. As previously announced, the bond is expected to be rated Baa2 (stable outlook) by Moody’s Investors Services, and will be issued pursuant to Burberry’s Sustainability Bond Framework, which has received a ‘second party opinion’ from Sustainalytics.
The Company has a conservative capital allocation policy and already holds substantial liquidity. Following the outbreak of COVID-19, earlier in the year the Company drew down its £300 million Revolving Credit Facility (the ‘RCF drawings’) and issued £300 million of short-dated commercial paper under the Bank of England’s Covid Commercial Financing Facility (‘CCFF’), with a maturity in March 2021 (together, the ‘Debt Facilities’). The RCF drawings were repaid in full in the first quarter of FY 2020/21.
The Bond will rank pari passu with the Debt Facilities. The Bond will be guaranteed by the Burberry group entities which also guarantee the £300 million Revolving Credit Facility. The Bond will be offered to professional investors and eligible counterparties. Applications will be made for the admission of the Bond to be listed on the Official List of the UK Listing Authority and to be traded on the Main Market of the London Stock Exchange.
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