Odfjell SE successfully places shipping’s first Sustainability-Linked Bond

As the first in the international shipping industry, Odfjell SE has successfully issued a sustainability-linked bond. With a tight link to Odfjell’s long-term climate targets, the bond marks another milestone in the company’s ambitious work to reduce the environmental impact of shipping.

As referenced in today’s stock market notice, DNB Markets, Nordea and SEB acted as Joint Lead Managers and Sustainability Structuring Advisors in the transaction. Upon closing, the unsecured bond issue was substantially oversubscribed and driven by a high-quality and ESG (Environmental, Social and Governance) focused orderbook. The issue size was set to NOK 850 million with a maturity date in January 2025. Proceeds from the bond issue will be used to refinance existing bonds and for general corporate purposes. The bond is intended to be listed on Oslo Børs and Euronext ESG Bonds.

The bond issue is the first to be issued under a newly established Sustainability-Linked Finance framework, and is linked to Odfjell’s fleet transition plan and ambition to reduce the carbon intensity of its controlled fleet by 50% by 2030 compared to 2008 level.

“With this sustainability-linked bond, we prove our strong commitment to reduce emissions and build a more sustainable shipping industry,” CEO Kristian Mørch said. “Odfjell has for many years worked actively to drive change and reduce our carbon footprint, and we are now pleased to see that investors and banks support us through this sustainability-linked bond.”

The sustainability-linked bond marks a first not only for Odfjell, but also for the international shipping industry, and for the Nordic region across all industries. 

“The shipping industry plays a vital role in the green transition. With Odfjell’s clear commitments, decarbonization strategy and ambitious CO2 emission reduction targets, they show the way as a leading company in the industry. By linking their CO2 emission reduction target with their bond financing terms, they further bolster their commitments and inspire other peers to follow. We are humble and grateful for being selected as facilitators of this hallmark transaction and supporting Odfjell on their sustainability pathway,” said the Joint Lead Managers at DNB, Nordea and SEB.

Odfjell SE recently launched climate targets that go beyond IMO’s targets, and the company is already well underway. Since 2008, the company has run several improvement and efficiency programs, resulting in an almost 30% reduction in carbon intensity. The new climate targets are a part of the company’s strategy on environmental, social and governance elements of the business.

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