Masdar has raised $1 billion through its third green bond issuance, following strong investor demand that saw the offering oversubscribed by 6.6 times.
The new issuance was split evenly across five-year and ten-year tranches, priced at coupons of 4.875% and 5.375% respectively.
It brings total proceeds from Masdar’s green bond program, launched in 2023, to $2.75 billion.
Proceeds from the latest bonds will be used exclusively to fund greenfield renewable energy projects, in line with Masdar’s Green Finance Framework.
The framework was updated earlier this year to include green hydrogen and standalone battery storage.
Moody’s has awarded the updated framework its highest Sustainability Quality Score of SQS1 (Excellent).
“This third issuance demonstrates the continued and growing confidence the investment community places in Masdar’s financial strength and long-term vision,” said Mohamed Jameel Al Ramahi, CEO of Masdar.
“The funds raised will be critical in achieving our portfolio targets and supporting energy transitions globally, particularly in emerging and developing markets.”
Masdar secured some of its tightest bond pricing to date, with spreads of 80 basis points over US Treasuries for the five-year tranche and 90 basis points for the ten-year.
The strong pricing reinforces the company’s growing credibility in international debt markets.
Around 85% of the allocation went to international investors, with the remaining portion taken up by buyers in the MENA region.
The transaction was jointly managed by a consortium of global and regional banking heavyweights, including First Abu Dhabi Bank, Abu Dhabi Commercial Bank, J.P. Morgan, ING, Intesa Sanpaolo, Bank of China, DBS Bank, BNP Paribas, and Crédit Agricole.
Masdar’s successful issuance comes amid a broader green finance boom across the Gulf, particularly in the UAE and Saudi Arabia.
According to Bloomberg data, green, social, sustainable, and sustainability-linked bond (GSSB) issuances in the MENA region surged 155% to a record $24 billion in 2023, with the UAE and Saudi Arabia accounting for 77% of the total.
The UAE alone hosted 11 debut green issuers in 2023 including DP World, TAQA, Mubadala, Emirates NBD, Aldar, and Commercial Bank of Dubai.
The UAE’s net-zero target for 2050, combined with an ambitious pipeline of clean energy projects, has further galvanized demand for green debt.
Masdar’s previous green bond issuances in 2023 and early 2024—$750 million and $1 billion respectively—were similarly oversubscribed, with proceeds directed toward renewable energy investments in both advanced and emerging markets.
“We are raising sustainable finance on an industrial scale,” said Mazin Khan, Masdar’s CFO. “Our green bonds offer investors a transparent and impactful way to contribute to global decarbonisation efforts, particularly in markets where climate financing is most urgently needed.”
Masdar is expecting to play a central role in the region’s green finance landscape as the UAE accelerates its renewable energy efforts.
The company has already secured $6 billion in non-recourse financing in 2024 to develop over 11 GW of clean energy capacity across 12 projects in nine countries.
