The interest rate of the notes is linked to the achievement of a specific sustainability target in line with IHO Verwaltung’s Sustainability-Linked Financing Framework. In case of a failure to achieve the sustainability target relevant for the notes, which is the reduction of the Schaeffler Group’s greenhouse gas emissions from its own operations (Scope 1+2) by at least 75% by 2025 compared to 2019, the annual interest rate would increase by 25 basis points.
IHO Verwaltung will use the proceeds from the issuance of the new notes, together with cash on hand, to redeem EUR 500 million of its existing senior secured PIK toggle notes due 2025 and to pay associated transaction costs. This transaction is the first sustainability-linked offering by IHO Verwaltung and the first offering of PIK toggle notes in the European high yield market since 2021.
The Allen & Overy team advising with respect to the notes is being led by partner Marc Plepelits, senior associates Rita Nicole Thomas and Martin Schmidt and associate Ariana Mercado (all US Corporate Finance).
Partners Dr. Walter Uebelhoer (Banking and Finance, Munich), Dr. Udo Olgemöller (Public Law, Frankfurt), Heike Weber (Tax, Frankfurt), Ken Rivlin (Environmental/Regulatory, New York) and Tim Conduit (Capital Markets, London), counsels Dr. Ilja Baudisch (Banking and Finance, Munich), John Hibbard (Tax, New York), Maria Christopher Bell (Environmental/Regulatory, New York), senior associates Anna Jung (Public Law, Frankfurt), Caroline Motzer (Capital Markets, Luxembourg), Elke Funken-Hötzel (Banking and Finance, Frankfurt), and associates Jacob Ely (Environmental/Regulatory, New York) and Manuel Koechel (Tax, Frankfurt), also advised on the transaction.
IHO Verwaltung is being advised internally by Dr. Alexandra Zech and Juliane Wittig (legal counsel, Herzogenaurach).
