FrieslandCampina issues 300 million euro ‘green’ promissory note

8 April 2016

Today, FrieslandCampina announced the issuance of a 300 million euro ‘green’ promissory note (‘Green Schuldschein’). Proceeds from the promissory notes sales will be used for financing the reduction of the environmental footprint of the global operations of FrieslandCampina in accordance with its sustainability and CSR policy as part of its route2020 strategy.

This is the first ‘green’ promissory note from a non-German issuer and the first ‘green’ debt instrument issued by a dairy company. The 300 million euro transaction consists of four tranches with fixed interest rates, which will mature after 5, 7, 812 and 10 years at an average interest rate of 1.4 per cent. The average maturity of the transaction is slightly over seven years. The offer with initially a volume of 200 million euro was more than three times subscribed and attracted German savings banks, international institutional investors as well as international banks.

Hein Schumacher, Royal FrieslandCampina N.V.’s Chief Financial Officer: “The issuance of this ’green’ promissory note shows that FrieslandCampina is willing to take bold steps in sustainability. We reduce the environmental footprint worldwide and we invest in programmes for local farmers in Asia, Africa and East Europe to help them improve their farm management and milk quality. This promissory note is of interest to investors that support our ambitions for sustainable growth in the entire milk chain.”

Efficient and sustainable production chain

The proceeds of the ‘green’ promissory note contribute directly to FrieslandCampina’s sustainability and CSR programmes as well as to the realisation of its purpose nourishing by nature: better nutrition for the world, a good living for our farmers, now and for generations to come. In order to achieve climate-neutral growth, FrieslandCampina is working on a number of initiatives advancing an efficient and sustainable production chain, including reduction of the amount of energy and the amount of water used in the production of dairy products.

More specifically, the proceeds of the promissory note will be used for decreasing the environmental footprint of three Dutch production locations in Borculo, Leeuwarden and Veghel and a production location in Manilla on the Philippines. Other projects eligible for proceedings are the projects of FrieslandCampina’s Dairy Development Programme in Asia and Africa, in which the company offers assistance to thousands of local farmers in improving their farm management and milk quality.

Parties involved

The promissory note is in line with the Climate Bond Standard 2.0 of the Climate Bonds Initiative. FrieslandCampina launched and priced its ‘green’ promissory note with the support of Bayerische Landesbank, BNP Paribas, ING Bank, Rabobank in cooperation with Raiffeisen Bank International and UniCredit. FrieslandCampina works with the Dairy Sustainability Framework of the Global Dairy Agenda for Action (GDAA). Based on this, sustainability rating agency VigeoEiris gave a positive opinion on the sustainability of the promissory note. It also rated the corporate sustainability performance of FrieslandCampina as being robust.