Morales & Besa successfully advised the State of Chile in the issuance, placement and repurchase of green sovereign bonds in Euros and Dollars

January 29, 2020

Morales & Besa acted as special local counsel to the Republic of Chile and its Ministry of Finance in connection with the issuance and global offering of green sovereign bonds due 2040 for a principal amount of €1,269,017,000 and 1.250% coupon, and in a reopening of sovereign green bonds due 2031 with principal amount of €693,685,000 and 0.830% coupon. Banco Santander, BNP Paribas and Société Générale acted as joint bookrunners for the EUR sovereign green bond issuance.

With respect to the use of the proceeds, Chile applied a portion thereof to liability management pursuant to a concurrent tender offer by virtue for the repurchase of old bonds due 2025, 2026, 2029, 2030 for a total consideration of €438,512,000, and the balance for general governmental purposes. Furthermore, Chile declared its intention to invest an amount equal to the proceeds from the sale of the notes issued in 2020 pursuant to Supreme Decree No. 2,060 of the Ministry of Finance, into projects that may qualify as “eligible green expenditures” under the Green Bond Framework.

In addition, Morales & Besa advised the Republic of Chile, in the issuance and global offering of a sovereign green bonds due 2032 with a principal amount of US$750,000,000 and a 2.550% coupon and in a reopening of sovereign green bonds due 2050 with principal amount of US$900,000,000 and a 3.500% coupon. Credit Agricole Securities, HSBC Securities and J.P. Morgan Securities LLC act as joint bookrunners for the USD denominated sovereign green bond issuance.

This transaction was novelty since was the first time in history that a government execute a liability management transaction in conjunction with a sovereign green bond issuance.

The Morales & Besa team that participated in the transaction was led by partner Guillermo Morales, along with senior associates Andrea Díaz and Jaime Rosso, and associate Mariana Schnettler.

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