Spain and Mexico
Press Release

Telefónica issues a green hybrid for an amount of 1,000 million euros


Telefónica press release

This is an automated translation of the press release issued in Spanish

Telefónica has today successfully issued a green hybrid for an amount of 1,000 million euros and a maturity of 7.25 years. The operation has been favorably received in the market by institutional investors, whose interest has exceeded the amount finally issued by more than 5 times.

The investor base has been widely diversified, highlighting the participation of international investors, which represents more than 90%. The company, which has managed to increase the volume from the initial idea of €750m to the final amount of 1,000 million, has also managed to significantly improve conditions, going from an initial coupon of 6.75% to a final cost of 6.135%, which has represented a reduction of more than 60 basic points. The closing and final disbursement of the operation will be on February 2.

In parallel, Telefónica has also presented today a repurchase offer for two hybrids with a redemption date of September 2023 and March 2024 which, according to the schedule, will end on January 31. The closing of the operation will be on February 3.

Both operations, both the issuance of the green hybrid and the repurchase offer, are intended to continue proactively managing the company's hybrid capital base. At the end of September, the average life of the debt stood at 13 years.

Energy efficiency

In line with the strategy maintained by Telefónica in the last issuances, and in accordance with the Sustainable Financing Framework in force, the funds obtained will be allocated to investments in green projects that seek to achieve greater energy efficiency, and consisting, fundamentally, in the shutdown of obsolete equipment and the deployment and improvement of the network infrastructure. The transformation of telecommunications networks (deployments of fiber and 5G technology), as well as renewable energy generation plans are the main levers to improve efficiency and reduce the carbon footprint.

Once the projects have been identified and awarded, which will necessarily refer to new investments made up to two years before or after the issuance, Telefónica will report its impact on energy consumption per petabyte of data traffic, on the energy savings it represents and in CO² emissions avoided.

Commitment to the planet

Today's issuance continues Telefónica's objective that 25% of its financing by 2024 meets sustainability criteria. It is also linked, in a more generic way, with the company's sustainability objectives, integrated into its business strategy and aligned with the United Nations Development Goals (SDGs), deploying sustainable, resilient and quality infrastructures and services that are one of the main socioeconomic engines of the regions in which Telefónica operates.

Telefónica addresses its commitment to the planet by influencing the environmental SDGs (7, 11 and 13), decoupling its growth from the environmental footprint and helping to decarbonize the economy and works to achieve net zero emissions by 2040 throughout its value chain, with the intermediate objective of neutralizing emissions, reach 1+2 in 2025 in its main markets.

The new green hybrid is also in line with the company's goal of helping its customers avoid the emission of more than 50 million tons of CO2 emissions between 2020 and 2025 thanks to digital solutions and achieving zero waste by 2030.

Precisely the projects to which the funds obtained will be allocated, that is, the deployment of fiber optics and 5G infrastructure or the plans to extend renewable energy, are key in achieving these objectives: fiber optics is 85% more efficient in terms of energy than copper; and 5G consumes, per unit of traffic, up to 90% less than 4G.

Telefónica stands at close to 17,000 million euros in sustainable financing, since it launched the first green bond in the industry in 2019, and including today's operation and the company's sustainable financing lines. In terms of issues, it is the leader in the telco sector with more than €6,600m of funds raised in the capital market.

Subscribe to the leading business intelligence platform in Latin America with different tools for Providers, Contractors, Operators, Government, Legal, Financial and Insurance industries.

Subscribe to Latin America’s most trusted business intelligence platform.

Other projects in: ICT (Mexico)

Get critical information about thousands of ICT projects in Latin America: what stages they're in, capex, related companies, contacts and more.

Other companies in: ICT (Mexico)

Get critical information about thousands of ICT companies in Latin America: their projects, contacts, shareholders, related news and more.

  • Company: Megacable Holdings S.A.B. de C.V.  (Megacable)
  • Megacable is a Mexican telecommunications company dedicated to the installation, operation, maintenance and exploitation of cable television signal distribution systems, interne...
  • Company: Letseb, S.A. de C.V.  (Bestel)
  • Bestel is a telecommunications provider owned by Mexican telecom group Empresas Cablevisión, S.A.B. de C.V. (Izzi). It is made up of Letseb S.A. de CV. and its subsidiaries, Ope...
  • Company: Eutelsat Americas
  • Eutelsat Americas (formerly Satmex) is a Mexican company that offers fixed satellite services to local and international broadcasting and telecom firms throughout the Americas, ...