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Coca-Cola İçecek Issues the First Sustainability-Linked Bond of the Industry in EMEA Region

Coca-Cola İçecek (CCI) combined its sustainability-oriented operations with its funding strategy to issue bonds at a lower cost compared to the country's reference borrowing rate for foreign markets. The company launched Türkiye’s largest sustainability-linked bond issuance to date with 500 million dollars' worth of bonds. CCI aims to increase water use efficiency by 13% until 2027 and 17% until 2029. Coca-Cola İçecek achieved significant success with 4.75 percent interest rate for the bonds that have a maturity date of January 2029.

With the positioning of the sustainability goals at the center of its operations, Coca-Cola İçecek (CCI) launched the first sustainability-linked bonds of the beverage industry in the Europe, Middle East and Africa (EMEA) region. While the appetite for the risk is shrinking towards developing countries, CCI issued bonds worth 500 million US dollars with 7-year maturity at an interest rate of 4.75% as a part of its borrowing initiative. This allowed CCI to issue Türkiye’s largest sustainability-linked bonds at a lower cost compared to the country’s reference borrowing rate for foreign markets.

The CEO of Coca-Cola İçecek, Burak Başarır said, "We serve over 430 million consumers across 11 countries including Türkiye and our target is to create value for all our stakeholders in our operations. Our sustainability-linked bonds are a perfect example of our focus on sustainability and integrated business model. We are proud to issue the first sustainability-linked bond of both Türkiye and the beverage industry in the EMEA region and this has also brought some heat to the Turkish market. Başarır reminded that CCI received an investment grade rating of "BBB-" by the international credit rating agencies S&P and Fitch in 2021 and continued, "We have issued highly advantageous bonds thanks to our successful performance affirmed by international credit rating agencies.” 

The bonds have been the first private sector bonds issued in Türkiye in the last 6 months and 34% of the bonds were sold in the USA, 30% were sold in the European Union and 16% were sold in the United Kingdom markets. CCI achieved this success as a result of having some of the most important brands in its portfolio as well as its business model focused on corporate management principles in high potential countries, a strong balance sheet, the sustainability focus of the bond and a stable shareholding structure with Anadolu Group and The Coca-Cola Company.

CCI positions sustainability at the core of its business model and the company demonstrated the strong alignment between its financial strategy and sustainability focus through this bond. The bonds received positive responses from the investors over the meetings held with more than 75 investors before the issuance of the bonds. Sustainalytics, an independent ESG research, rating and data company offering Second Party Opinion, rated the objectives in CCI's sustainability framework document as “strong”. CCI's commitment to increase water use efficiency by 13 percent until 2027 and by 17 percent until 2029 compared to its base year 2020 was also described as “ambitious” by Sustainalytics.