Centrica returns to the debt capital markets with a £405m hybrid bond issuance

22 May 2024

Investor and Analysts

Media Relations

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£405m issuance with May 2030 first call date and May 2055 maturity, priced with a 6.50% coupon
Oversubscribed by 5.0 times at the peak, with demand from 150 investors
First European hybrid bond to benefit from Moody’s revised rating methodology, achieving an investment grade instrument rating of Baa3

Centrica (the “Company”) today issued £405m of hybrid bonds with a coupon of 6.50%, maturity of May 2055, and a first call date in May 2030. The issuance, which refinances the Company’s existing £450m hybrid bond, was oversubscribed by 5.0 times at the peak, with demand from 150 investors, resulting in a strong pricing outcome.

In a debt market first, the new hybrid bond is the first European hybrid bond to benefit from Moody’s revised rating methodology, achieving an investment grade rating of Baa3, only one notch below the Company’s LT issuer rating of Baa2.

J.P. Morgan acted as sole Structuring Agent and Barclays, J.P. Morgan, NatWest Markets and Societe Generale as Joint Active Bookrunners and Goldman Sachs and UBS as Joint Passive Bookrunners on the new issue transaction.

Russell O’Brien, Centrica Group Chief Financial Officer, said: “I am delighted with the strong outcome we have achieved on our hybrid bond refinancing which clearly reflects investors’ confidence in Centrica’s financial strength, strategy and growth plans.

"The refinancing retains Centrica’s access to a broad range of financing sources, is consistent with our prudent balance sheet management policy, and supports our existing operations and future growth.”