Voestalpine issues the first green bonds in the European steel industry

The international steel and technology group voestalpine has successfully issued its first green corporate bonds for €500 million. The company said in a statement.

The bonds have a five-year maturity and a coupon of 3.75%, which reportedly meets high investor demand. All proceeds from the issue will be used to finance or refinance voestalpine’s sustainability projects, such as greentec steel.

According to Herbert Eibensteiner, CEO of voestalpine, the company has been a benchmark for sustainability in the industry for decades and has a clear plan to transform steel production through the greentec program.

“As early as 2027, we will partially switch from a traditional blast furnace to electric arc technology using clean electricity, thereby reducing our emissions by around 30% by 2029. This makes greentec steel the largest climate protection program in Austria. By issuing the first green bonds in the European steel industry, we are now also taking on the role of a pioneer in the capital market,” he emphasized.

A few weeks ago, voestalpine became the first European steel company to publish a Green Finance Framework, which is the basis for a green bond. This framework was reviewed by Moody’s as part of a second opinion and received the highest rating (“very good”).

As noted, the company’s environmental financing system meets the strict requirements of the International Capital Market Association.

In July 2024, voestalpine attracted a €300 million EIB loan for the production of green steel. The funding will be used to implement a four-year research and development program aimed at optimizing production processes, increasing energy and raw material efficiency, and extending product life.