KYOTO, Japan, Nov. 10, 2019 (GLOBE NEWSWIRE) — Nidec Corporation ((TSE:6594, OTC:NJDCY) (“Nidec”) today announced plans to issue Green bond* in the Japanese domestic market through a public offering (“the Issuance”). Nidec seeks to raise approximately 100 billion yen from the Issuance, which would mark the largest corporate green bond ever issued in Japan.
1. Objective and Background
The world is increasingly going electric to reduce its dependence on coal and other fossil fuels — non-renewable energy sources deemed responsible for more than three quarters of climate change-inducing greenhouse gas emissions. In the meantime, according to the International Energy Agency, approximately 38% of global electricity still comes from coal-fired power plants. Looking at the demand side, electric motors are estimated to account for half the electricity consumed worldwide. These facts indicate that collective improvements in motion-control efficiency play a key role in the advancement of low-carbon social infrastructure, including road transportation. Acting at the global forefront of motor drive technology and manufacturing, Nidec is committed to doing its part to help curb global warming by serving as a critical gateway to a decarbonized world.
Nidec’s strategic response to this top-priority challenge centers on the design and manufacture of environmentally superior motor drive products that enable end applications to outperform the most stringent energy–efficiency and carbon emissions standards in any given industry they serve. With particular reference to the automotive industry, a once-in-a-century technological shift is going on to make more vehicles run on electricity than on petrol or diesel fuels, in which electric traction motors are chosen over combustion engines. Nidec is proactively aligning its technological, manufacturing, and partnership strengths with the transformative trend in ways consistent with the evolving technological requirements of global automakers. One such example is the development of E-Axle, a traction motor system designed to help electric and plug-in hybrid vehicles run with near-zero direct emissions. In addition, Nidec’s own-developed cooling system gives E-Axle extra compactness, allowing automakers to design lighter and less resource-reliant vehicles.
Nidec expects the Issuance to generate an increasingly liquid source of funding necessary to diversify its investor bases and hopes to become part of the meaningful fabric of a thriving bond market and sustainable society.
2. Feature of the Issuance
Nidec plans to use the proceeds from the Issuance to finance its facilities and R&D activities associated with the design and manufacture of traction motors for electric vehicles. A Second Party Opinion has been obtained from Sustainalytics, a leading international third-party verification provider.
Nidec has submitted today an amendment shelf registration statement to the Director of the Kanto Local Finance Bureau. In this Issuance, Mitsubishi UFJ Morgan Stanley Securities Co., Ltd., Daiwa Securities Co. Ltd. SMBC Nikko Securities Inc., Goldman Sachs Japan Co., Ltd. and JPMorgan Securities Japan Co., Ltd. are appointed as the lead managers. The Issuance is scheduled for the latter half of November 2019 and thereafter, depending on market demand.
The details are as follows:
|1.||Name of the Bonds||NIDEC Green Bond|
|2.||Series||9th Series||10th Series||11th Series|
|3.||Total Principal Amount||JPY50billon||JPY30billon||JPY20billon|
|4.||Issuance Period||3 years||5 years||7 years|
|5.||Use of Proceeds||Capital expenditure and R&D expense for the production of traction motors for EVs|
|6.||Eligibility of Green Bond Framework||The company has obtained the Second Party Opinion** for the criteria set forth by the International Capital Markets Association (ICMA) in its “Green Bond Principles 2018 (GBP)and Japan’s Green Bond Guidelines 2017 from Sustainalytics, a leading international third-party verification provider.|
|7.||Green Bond Structuring Agent***||Mitsubishi UFJ Morgan Stanley Securities Co., Ltd.|
|8.||Underwriting Securities||Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. ,Daiwa Securities Co.Ltd. , SMBC Nikko Securities Inc. , Goldman Sachs Japan Co., Ltd. , JPMorgan Securities Japan Co., Ltd.||Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. ,Daiwa Securities Co.Ltd. , SMBC Nikko Securities Inc. , Goldman Sachs Japan Co., Ltd. , JPMorgan Securities Japan Co., Ltd.||Mitsubishi UFJ Morgan Stanley Securities Co., Ltd. ,Daiwa Securities Co.Ltd. , SMBC Nikko Securities Inc. , Goldman Sachs Japan Co., Ltd.|
|9.||Offering Period||Scheduled for the latter half of November 2019 and thereafter, depending on market demand.|
* Green Bond: Bonds issued to raise funds required for businesses that help solve environmental problems such as global warming.
** For more information on Opinions, please refer to Sustainalytics Website at: https://www.sustainalytics.com/sustainable-finance/wp-content/uploads/2019/11/Nidec-Corporation-Green-Bond-Second-Party-Opinion-08112019-ENGLISH.pdf
*** Green Bond Structuring Agent: One who supports the issuance of green bonds through the formulation of a green bond framework and advice on obtaining a second opinion, etc.
|This press release has been prepared for the sole purpose of publicly announcing the Company’s issuance of the Bonds, and not for the purpose of soliciting investment or engaging in any other similar activities within or outside of Japan.|