Verizon prices its third $1 billion green bond

Rhea-AI Summary

Verizon Communications (VZ) issued its third green bond worth $1 billion on September 3, 2021, reinforcing its position as a top corporate buyer of renewable energy in the U.S. The proceeds will fund renewable energy projects, including long-term virtual power purchase agreements (VPPAs) for nearly 1.9 gigawatts of capacity. These efforts align with Verizon's goals to meet 50% of its electricity needs through renewable sources by 2025 and achieve net-zero operational emissions by 2035. The company also emphasizes diversity in its underwriter selection, partnering with diverse firms for this bond issuance.

Positive

• Third green bond issuance of $1 billion indicates strong commitment to renewable energy.
• Verizon has entered into 14 VPPAs for nearly 1.9 gigawatts of renewable energy capacity.
• Aims to source or generate 50% of total electricity from renewable sources by 2025.
• Plans to achieve net-zero operational emissions by 2035.
• Increased focus on diversity in underwriter selection, supporting minority- and women-owned firms.

Negative

• None.

Becomes a leading corporate buyer of renewable energy in the U.S.

Adopts green bond underwriter selection criteria focusing on sustainability and diversity commitments

NEW YORK, Sept. 08, 2021 (GLOBE NEWSWIRE) -- Verizon Communications Inc. (NYSE, Nasdaq: VZ) settled its third green bond offering of $1 billion on September 3, shortly after the full allocation of its second green bond toward renewable energy commitments. The net proceeds of its third green bond are expected to also be allocated entirely toward renewable energy as the company continues to enter into long-term virtual power purchase agreements (VPPAs) which support the construction of solar and wind power facilities.

“In less than two years, Verizon has become one of the leading corporate buyers of renewable energy in the U.S., entering into fourteen VPPAs for nearly 1.9 gigawatts of renewable energy capacity,” said Matt Ellis, Verizon’s Executive Vice President and Chief Financial Officer. “These investments are consistent with our commitments in support of the U.N. Sustainable Development Goals, to source or generate renewable energy equivalent to 50% of our total annual electricity consumption by 2025, and to be net-zero in our operational emissions by 2035 (scope 1 and 2 emissions). Furthermore, this transaction aligns with our commitment to advancing racial and social equity in the capital markets by partnering with women- and minority-owned firms.”

Verizon has added underwriter selection criteria focused on sustainability and diversity commitments to its updated Green Financing Framework. The framework states that a financial institution will be eligible for selection as an underwriter for green financing instruments only if it meets at least one of the following criteria: [1] it has established clear and impactful commitments in support of the U.N. Sustainable Development Goals and/or is a diverse-owned firm and/or [2] has a core mission of promoting Diversity, Equity and Inclusion. Based on these criteria and long-standing trusted relationships, Verizon selected three minority- and women-owned firms as lead underwriters for the launch of the green bond: Loop Capital Markets, Ramirez & Co., Inc. and Siebert Williams Shank.

In addition, Verizon appointed Morgan Stanley as one of its four lead underwriters. Morgan Stanley has been a leader in sustainability for over a decade, being the first major U.S.-based global bank to commit to net-zero financed emissions by 2050, while also championing Diversity, Equity and Inclusion with initiatives such as the Institute for Inclusion and the Multicultural Innovation Lab. All four lead underwriters shared equal responsibility in bringing this successful transaction to the market.

Year to date, Verizon has paid approximately $20 million in underwriting fees to minority- and women-owned firms, including $4.5 million for this third green bond and more than $14 million in fees related to Verizon’s $25 billion debt offering in March, with the latter transaction holding the record for the most fees paid to minority- and women-owned firms in a single transaction.

“Loop Capital is thrilled to partner with Verizon as an active lead underwriter on its third green bond issuance. With this transaction, and the innovations it has incorporated into its sustainability framework, Verizon continues to demonstrate that it is at the forefront of the industry and a true leader in ESG,” said Jim Reynolds, Chairman and CEO, Loop Capital Markets. “Verizon continues to embody the most powerful elements of global corporate citizenship by taking responsibility in protecting the environment and by promoting and advancing the capabilities of minority- and women-owned firms as lead underwriters.”

“We are proud of being selected for our role on this offering, reflecting our own commitments such as our net-zero financed emissions goal and our shared core value of promoting diversity, equity and inclusion. We applaud Verizon in its remarkable sustainability journey, including their science-based emissions reductions targets to reduce carbon emissions and the expansion of their Green Financing Framework to include new criteria for selection of underwriters. Their third consecutive green bond issuance was met with strong and broad global investor participation ensuring a successful outcome,” said Melissa James, Vice Chair and Head of Morgan Stanley’s ESG Center of Excellence.

“Congratulations to Verizon on the completion of its third green bond. We are honored to have been appointed as a lead underwriter for this important transaction, which enabled us to showcase our capabilities and compete at the highest levels. Verizon continues to demonstrate leadership and vision in its inclusion of DEI firms. As we celebrate our 50th anniversary in 2021, we recognize that it is opportunities such as this that have enabled us to grow our business over the years,” said Sam Ramirez Jr., Senior Managing Director, Ramirez & Co., Inc.

“With the issuance of its third consecutive $1 billion green bond, Verizon once again demonstrates its commitment to the principles of racial diversity and economic inclusion, while also continuing to be a standard bearer for corporate environmental responsibility,” said Chris Williams, Chairman of Siebert Williams Shank. “We thank Verizon for providing significant economic support and the opportunity for its diverse banking partners to gain substantive professional experience, which enables our firms to enhance the breadth and quality of the capital markets services that we deliver to all of our clients.”

This capital market transaction aligns with Verizon’s long-standing commitment to drive both environmental and social progress as part of its responsible business plan, Citizen Verizon, empowering the technology leader to deliver on its mission to move the world forward by addressing pressing societal issues.

Verizon Communications Inc. (NYSE, Nasdaq: VZ) was formed on June 30, 2000 and is one of the world’s leading providers of technology, communications, information and entertainment products and services. Headquartered in New York City and with a presence around the world, Verizon generated revenues of $128.3 billion in 2020. The company offers data, video and voice services and solutions on its award-winning networks and platforms, delivering on customers’ demand for mobility, reliable network connectivity, security and control.

VERIZON’S ONLINE MEDIA CENTER: News releases, stories, media contacts and other resources are available at verizon.com/news. News releases are also available through an RSS feed. To subscribe, visit www.verizon.com/about/rss-feeds/.

Media contact:
Kim Ancin
Kimberly.ancin@verizon.com
908.801.0500

Eric Wilkens
eric.wilkens@verizon.com
201.572.9317

FAQ

What is the significance of Verizon's third green bond issuance?

Verizon's third green bond issuance of $1 billion supports its commitment to renewable energy and enhances its role as a leading corporate buyer in the U.S.

How much renewable energy capacity has Verizon committed to through VPPAs?

Verizon has entered into fourteen VPPAs for nearly 1.9 gigawatts of renewable energy capacity.

What are Verizon's sustainability goals?

Verizon aims to generate or source 50% of its total annual electricity from renewable energy by 2025 and achieve net-zero operational emissions by 2035.

How does Verizon ensure diversity in its green bond underwriting?

Verizon has implemented selection criteria that prioritize sustainability and diversity, partnering with minority- and women-owned firms as lead underwriters.