Charles Sternberg, Assistant Editor05.05.21
Natura &Co, which includes the Avon, Natura, The Body Shop and Aesop brands, has completed an international fundraising of $1 billion in bonds linked to sustainability goals. The issue was carried out by its subsidiary, Natura Cosméticos S.A., with Natura & Co Holding S.A. acting as the guarantor.
The funds will be used to refinance existing debt, in line with the group's liability management plan to improve its capital structure. The seven-year notes mature on May 3, 2028 and carry an interest coupon of 4.125% per year, to be paid on a half-yearly basis.
Meeting Environmental Performance Indicators
The transaction commits Natura to meet two environmental performance indicators by 2026 year-end:
These goals are aligned with the group's "Commitment to Life, Sustainability Vision 2030" and support Natura &Co's efforts to address the global climate crisis and adopt full packaging circularity.
The year 2019 is considered as the baseline for the targets stipulated in the issue and the penalty if these indicators are not reached is an increase of 65 basis-points in the interest rate as of November 2027.
Roberto Marques, executive chairman and group CEO of Natura &Co, stated, "The successful raising of $1 billion in bonds linked to sustainability targets is a milestone for Natura &Co and for Natura, and is the largest-ever single issuance by a Brazilian issuer. The strong demand for the securities is a recognition by the market of the Group's solid capacity to deliver social, environmental and financial results.”
Marques continued, “Natura already has a long and consistent history of commitment to sustainability and is now taking a further step connecting and aligning financial and environmental targets."
The funds will be used to refinance existing debt, in line with the group's liability management plan to improve its capital structure. The seven-year notes mature on May 3, 2028 and carry an interest coupon of 4.125% per year, to be paid on a half-yearly basis.
Meeting Environmental Performance Indicators
The transaction commits Natura to meet two environmental performance indicators by 2026 year-end:
- Reducing scopes 1, 2 and 3 of relative greenhouse gas (GHG) emissions intensity by another 13%, and
- Reaching 25% of post-consumer recycled (PCR) plastic in plastic product packaging.
These goals are aligned with the group's "Commitment to Life, Sustainability Vision 2030" and support Natura &Co's efforts to address the global climate crisis and adopt full packaging circularity.
The year 2019 is considered as the baseline for the targets stipulated in the issue and the penalty if these indicators are not reached is an increase of 65 basis-points in the interest rate as of November 2027.
Roberto Marques, executive chairman and group CEO of Natura &Co, stated, "The successful raising of $1 billion in bonds linked to sustainability targets is a milestone for Natura &Co and for Natura, and is the largest-ever single issuance by a Brazilian issuer. The strong demand for the securities is a recognition by the market of the Group's solid capacity to deliver social, environmental and financial results.”
Marques continued, “Natura already has a long and consistent history of commitment to sustainability and is now taking a further step connecting and aligning financial and environmental targets."
