South Korea’s LG Electronics Raises $800 Million Global Sustainability Bond

LG Electronics has successfully issued its first global bond in 17 years, raising USD 800 million. The bond issuance received strong interest from global institutions, resulting in a negative New Issue Premium (NIP), indicating high demand. The bonds are divided into two categories: a USD 500 million bond with a 3-year maturity and a USD 300 million Sustainability Bond with a 5-year maturity. The spread above the US Treasury bond interest rate for the bonds was set at 95 basis points (bp) and 110bp, respectively, which was 40bp lower than initially proposed. LG received a substantial investment order of approximately USD 9.4 billion, demonstrating the success of its bond issuance and making it the most successful among Korean corporate bonds in 2024. Despite global volatility and uncertainties, LG’s financial stability and performance were recognized by global investment institutions. The funds raised will be used to enhance LG’s competitiveness through research and development (R&D) and facility investments, aligned with its 2030 Future Vision. The Sustainability Bond proceeds will be allocated to eco-friendly and social projects. The bond issuance was managed by a consortium of banks, including BNP Paribas, Citigroup, HSBC, JP Morgan, KDB, and Standard Chartered Bank. LG has received stable credit ratings of Baa2 from Moody’s and BBB from Standard & Poor’s. This successful return to the foreign bond market highlights LG’s strong presence in the global financial landscape and provides stable funding and diversification of borrowing sources. Resources: https://esgnews.com/south-koreas-lg-electronics-raises-800-million-global-sustainability-bond/