Spanish energy giant Iberdrola has successfully launched a €1bn green hybrid bond designed to replace a comparable financial instrument set to mature in early 2026, the company announced.
The perpetual security features a call provision starting in August 2031 and offers a 3.75% interest rate, representing the most attractive pricing for any hybrid bond launched this year and the best terms available since March 2022, according to Iberdrola.
The company emphasized that this financing arrangement adheres to both ICMA Green Bond Principles and the recently established EU Green Bond Standard, marking a milestone as the inaugural hybrid bond launched under the European Union's regulatory framework.
Market appetite for the offering was substantial, with investor interest reaching €8bn - representing eight times oversubscription relative to the final issuance amount - enabling the company to secure enhanced terms and competitive pricing, Iberdrola reported.
The transaction attracted participation from more than 400 institutional investors across international markets, with the majority originating from Europe and the United Kingdom. Additionally, over 87% of participating investors were classified as sustainable investment funds or organizations following UN PRI guidelines, the company disclosed.
A syndicate of nine financial institutions managed the transaction, with Barclays, Deutsche Bank, and Caixabank among the lead arrangers.
The company highlighted that this new issuance preserves its total hybrid bond portfolio at €8.25bn, consistent with strategic objectives outlined during its Capital Markets Day presentation.
Major credit rating agencies classify hybrid securities as 50% equity instruments, which strengthens Iberdrola's overall credit profile, the company explained.
This transaction represents Iberdrola's fourth capital markets activity of 2025, contributing to aggregate funding of €7.15bn for the year, which includes a €5bn equity raise finalized in July.
