LG Energy Solution, based in South Korea, confirmed on Tuesday it had raised $1 billion in its first global green bond issuance.
Good Evening Nigeria reports that a green bond is a type of financial instrument specifically issued to fund environmentally sustainable projects and initiatives, adhering to strict guidelines that ensure the use of proceeds for eco-friendly purposes.
Last month, reports from Reuters, citing insider sources, indicated that LG Energy Solution had set its sights on generating approximately $1 billion in funds through the issuance of two dollar-denominated green bonds.
The $1 billion bond offering comprises two segments: a three-year bond amounting to $400 million and a five-year bond totaling $600 million, as detailed in a statement released by LG Energy Solution.
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The three-year bonds were issued at a yield of three-year Treasuries plus 100 basis points and five-year bonds at five-year Treasuries plus 130 basis points, according to the company.
LG Energy Solution said it planned to use the funds to accelerate its investment in global production network.
It added that it aimed to lead on with investments in expanding product portfolio, in not only electric vehicle batteries but also energy storage systems (ESS) and others.
LG Chem , LG Energy Solution’s parent company, had raised $2 billion in five- and seven-year exchangeable bonds in July. Those bonds will be exchangeable into common shares of LG Energy Solution.