Sika AG has issued a €1 billion hybrid bond in two tranches, each raising €500 million from institutional investors. The bonds carry annual coupons of 4.375% and 4.875%, respectively, with first call dates set for 2032 and 2035.
The net proceeds will be used for general corporate purposes, including financing complementary acquisitions and refinancing existing financial liabilities, the Swiss construction chemicals group said in a statement on Wednesday. The transaction was structured to qualify for a 50% equity credit from S&P, which recently upgraded Sika’s outlook from negative to stable.
Hybrid bonds blend debt and equity characteristics, offering issuers lower financing costs while providing investors with higher yields than traditional corporate debt. The structure’s equity-like treatment by credit rating agencies can support balance sheet metrics, particularly for companies with acquisition-driven growth strategies.
