The success of MINT’s landmark ESG financing in Thailand in mid-2024 confirmed the importance and future potential of sustainability-linked transactions for Asia’s capital markets.
This THB8 billion ($237 million) issuance of debentures comprised a THB 5 billion sustainability-linked bond (SLB) and THB 3 billion standard bond. It was a milestone in ESG financing domestically and for the area – the primary of its sort inside Thailand’s hospitality sector, in addition to Asia’s first SLB for a corporation on this business.
Buyers actually responded favourably, with robust participation from high-quality accounts regardless of lingering volatility in international markets leading to an oversubscription of over seven occasions the preliminary goal challenge measurement.
On the similar time, MINT was capable of reinforce via this transaction the significance it locations on making a significant impression.
“The overwhelming investor demand along with MINT’s sturdy credit score profile enabled us to safe funding at very aggressive charges for refinancing excellent debt, thereby bringing down the corporate’s total funding value,” defined Chaiyapat Paitoon, chief monetary officer. “The SLB additionally reiterated our long-standing dedication to embracing sustainability practices.”
Giving buyers what they need
On the whole, SLB issuance is projected to develop in 2025, with Moody’s Scores forecasting a 14% enhance this yr to $35 billion.
MINT has already seen how robust investor urge for food could be. Its total provide garnered sturdy demand of greater than THB 36 billion from greater than 80 institutional and cooperative buyers, surpassing the preliminary goal challenge measurement of THB 5 billion and representing 7.3 occasions oversubscription.
Such participation additionally mirrored confidence in MINT’s efficiency after its speedy post-pandemic restoration, plus the corporate’s dedication to sustainability initiatives. Because of this, MINT took the chance to train a THB3 billion Greenshoe Choice, bringing the full transaction as much as THB 8 billion.
“This refinancing transaction aligns with our plan to enhance our monetary metrics and optimise our monetary leverage degree,” added Chaiyapat Paitoon at MINT.
Placing sustainability on the core
The transaction additionally performed a key half in sharpening and deepening MINT’s concentrate on sustainability as integral to its enterprise technique.
The issuance concerned drafting a sustainability-linked financing framework and acquiring a second get together opinion from Sustainalytics to make sure alignment with worldwide tips and requirements.
In the end, the corporate’s Sustainability Efficiency Targets (SPTs), related to SLBs, embody the next:
• KPI 1: Scope 1 and a pair of GHG emissions depth of Minor Motels (tCO2e per room bought)
• SPT1: Scale back Scope 1 and a pair of GHG emissions depth to 0.018 tCO2e per room bought by FY 2026 from a FY2019 baseline of 0.023 tCO2e per room bought
• KPI 2: Water withdrawal depth of Minor Motels (m3 per room bought)
• SPT2: Scale back water withdrawal depth to 0.68 m3 per room bought by FY2025 from a FY 2022 baseline of 0.75 m3 per room bought
The KPIs goal the GHG emissions depth and water withdrawal depth of Minor Motels, which characterize a big majority of Minor’s total emissions and water withdrawals, and can be the most important contributor to Minor’s income.
But MINT’s unwavering dedication to sustainability and accountable practices isn’t just a company accountability; it is a ethical obligation, defined Dillip Rajakarier, group chief govt officer (CEO) and CEO of Minor Motels.
He added that the issuance “serves as a reaffirmation of our dedication to make optimistic adjustments, not solely inside our operations, however hopefully all through your complete business.”
To assist obtain this, the corporate prioritises the creation of shared worth to profit everybody via its sustainability efforts.
“Our dedication is demonstrated via our bold internet zero targets, in depth group engagement programmes throughout our working areas, and devoted conservation initiatives to guard biodiversity in delicate ecosystems,” stated Chompan Kulnides, chief sustainability officer of MINT.
¬ Haymarket Media Restricted. All rights reserved.
