With the market for ESG financial products burgeoning, it is no surprise that issuers are becoming creative in linking their bonds’ financial and/or structural characteristics to their sustainability targets. Today (13 September 2021) marks the launch of a €450 million sustainability-linked bond offering to finance Stirling Square’s acquisition of Itelyum, an Italian waste management company. The bonds feature a novel sustainability-linked redemption premium step-up, which is new to the European high yield market.

As the market kicks back into full swing after a quiet August, global issuance of Sustainability-Linked Bonds (‘SLBs’) continues to reach new heights with the cumulative issuance standing at a monstrous €20.1bn year-to-date compared to 2020 where just ~€2.7bn was recorded across the European markets, as dissected further in 9fin’s monthly Sustainable Junk.