ENI, a bond arrives for retail. Here are the features

ENI announced thelaunch of the offer of the first bonds intended for the public in Italy linked to its sustainability objectives. The six-legged dog specified that the bonds pursue the objective of financing any future needs, maintaining a balanced financial structure and further diversifying financial sources.

In detail, the duration of the ENI bonds is 5 years with effect from 10 February 2023 and the principal will be repaid in full upon maturity of the loan (10 February 2028).

The total value of the bonds will be one billion euros, an amount that can be increased up to 2 billion euros in case of excess demand. The minimum lot that can be subscribed is 2,000 euros (equal to 2 bonds), with possible increases equal to at least one bond, for a nominal value of 1,000 euros each.

The bonds will pay the subscribers, annually and in arrears, fixed rate interest on the basis of the gross annual nominal interest rate which will be determined and communicated within 5 working days from the end of the offer period. This rate cannot be lower than the minimum rate, set at 4.3%. ENI specified that the last coupon payable on February 10, 2028 will be linked to achievement of two sustainability targets of the six-legged dog, i.e. the reduction of net greenhouse gas emissions (Scope 1 and Scope 2) associated with the Upstream business and the increase in installed capacity from renewable sources. Given the achievement of the defined objectives, the gross annual nominal interest rate will remain unchanged until the bonds mature. In the event of failure to achieve even just one of the two targets, the interest rate relating to the coupon payable on the expiry date (February 10, 2028) will be increased by 0.5%.

The offer of ENI bonds will start on Monday 16 January 2023. the oil giant has specified that it will be possible to register online (i.e. via remote communication) until Friday 20 January, with off-site offers until Friday 27 January and/or by going to the branch until Friday 3 February, unless it closes early. ENI has pointed out that acceptance of the offer of bonds will not involve any expense or subscription commission. The ENI bonds will be listed on the Electronic Bond Market (MOT) and they will have ISIN code: IT0005521171.

In the prospectus accompanying the issue of ENI bonds, the six-legged dog recalled that, for individual investors residing in Italy, the interest deriving from the bonds accrued during the period of holding of the same are subject to a substitute tax of 26%unless the investor holds the securities in an investment portfolio managed by an authorized intermediary and, under certain conditions, has validly opted for the application of the managed savings regime.

With reference to fees and expenses relating to the transaction in the prospectus ENI has indicated that it will pay the placement managersan organization commission, equally divided between them, consisting of a fixed part equal to 0.25% of the nominal value of the bonds issued and a variable part, at the discretion of the oil giant, equal to 0.05% of the nominal value of the bonds issued and object of the offer.

To the guarantorsENI will pay a guarantee fee equal to 0.3% of the nominal value of the bonds guaranteed by each of them.

Finally, ENI will pay the placersa placement commission equal to 1.45% of the nominal value of the bonds effectively placed and assigned by each of them, it being understood that the commission will in any case also be paid to the guarantors in the event of assumption.

ENI has asked the rating agencies Fitch, Moody’s and S&P Global to assign ratings with reference to the bondsthe. “It is foreseeable that this assignment will be released on the date of payment of the obligations,” specified the Six-legged dog.

In the information prospectus, ENI has highlighted that i expected ratings for ENI bonds they are “A-” for Fitch, “Baa1” for Moody’s and “A-” for S&P Global, in line with the issuer ratings at the date of publication of the prospectus.