Corporate credit ratings
|Standard & Poor's|
|Lead analyst||Ihsane Mesrar|
|Date rating / outlook last changed||January 2019|
Debt capital markets
The Lonza Group sources most of its debt financing directly from the debt capital markets. Please find below details of our debt capital market facility.
|EMTN Program||EUR||8 billion||Lonza Group Ltd||Lonza Finance International NV (Belgium)|
This section offers some important information for debt investors. The ability to flexibly use different sources of funds plays a key role in the financing of the Lonza Group. Lonza has therefore established a number of debt instruments.
Significant Debt Instruments:
|CHF instruments||Nominal Value|
|Straight bond (2017-2024)||110|
|Straight bond (2020-2026)||150|
|Straight bond (2023-2028)||185|
|Straight bond (2023-2029)
Issued in February 2023 (300m)
Increased in May 2023 (150m)
|Straight bond (2023-2031)||215|
|EUR instruments||Nominal Value|
|USD instruments||Nominal Value|
|Term Loan (2019-2025/2026)||700
Eurobond (2020 issuance)
In April 2020 Lonza issued its inaugural Eurobond with a coupon of 1.625% in the European capital market. The net proceeds were used to refinance existing debt and general corporate purposes. The bond with a volume of EUR 500 million has a maturity of 7 years. The notes have been offered under a standalone Prospectus and have been listed on the Luxembourg Stock Exchange.
CHF - Bonds
Lonza did not issue any CHF-Bonds in 2022. In February 2023, Lonza issued a CHF 300 million single tranche CHF-Bond with a maturity of 6.5 years and an annual coupon of 2.100%. The net proceeds were used for refinancing and general corporate purposes.
Following the successful closing of the sale of the Lonza Specialty Ingredients business and the receipt of the disposal net proceeds in July 2021, Lonza did not issue any new bonds or other debt securities neither in 2021 nor in 2022.
In 2021, Lonza repaid its scheduled debt maturities totaling CHF 727 million equivalent (thereof CHF 352 million related to the German Private Placement and CHF 375 million related to the Swiss bonds). In addition, Lonza decided to early repay the floating rate German Private Placement totaling CHF 432 million equivalent.
In 2022, Lonza repaid one Swiss bond with a nominal value of CHF 105 million
Syndicated Loan Facilities
In 2019, Lonza signed a Syndicated Loan Facility with a consortium of banks containing Term Loans and a Revolving Credit Facility.
With the agreement Lonza issued Term Loan tranches of EUR 500 million, USD 500 million and USD 200 million carrying floating interest rates and initially repayable in 2020, 2024 and 2025 respectively. The proceeds have been used to replace existing facilities at favorable market conditions. In April 2020 the Term Loan of EUR 500 million has been successfully refinanced with a 7 year Eurobond. In June 2020, Lonza successfully extended its USD Term Loans by 1 year.
The Revolving Credit Facility (RCF) provides Lonza additional financial headroom of CHF 1 billion, initially due 2024, at floating interest rates. The facility was not used as of 31 December 2022 (in 2021, the facility was not used either). Lonza successfully drew its extension option in 2020 and 2021, therefore the RCF was extended by 2 years in total with a final maturity date in 2026.
German private placement (Schuldscheindarlehen)
Following the repayment of the scheduled debt maturities of EUR 325 million (equaling to CHF 352 million equivalent) in August 2021 and the early repayment of the floating rate notes of USD 250 million and EUR 187.5 million in August and September 2021 (totaling CHF 432 million equivalent), Lonza maintains two fixed rate notes of the dual-currency Schuldschein issued in August 2017. Remaining notes are repayable in 2023 (EUR 187.5 million) and 2024 (USD 50 million).
Other current and non-current debt comprise industrial revenue bonds of USD 130 million (2021: USD 152 million) issued by governmental institutions in the United States (repayable in 2025, 2030 and 2047). One revenue bond (amounting to USD 23 million) was repaid in April 2022.
|Average interest rates %||%||million CHF||Average interest rates %||%||million CHF|