Capital Markets

Hydro One in its inaugural $1.05 billion offering of Medium Term Notes under New Sustainable Financing Framework

Hydro One Inc.
Key Contact
Michael Innes

Partner, Chair: Corporate, Toronto

Team
Rosalind Hunter

Partner, Corporate, Toronto

Amelia Miao

Partner, Corporate, Toronto

Desmond Christy

Associate, Corporate, Toronto

Jacqueline Kang

Associate, Corporate, Toronto

David Davachi

Partner, Tax, Toronto

James Chang

Associate, Tax, Toronto

Samuel Cohen

Associate, Translation, Montréal

Mélanie Proschek

Translator, Translation, Montréal

Valérie Huard

Translator, Translation, Montréal

 

On January 24, 2023, Hydro One Inc., a wholly owned subsidiary of Hydro One Limited (collectively, “Hydro One”) priced an offering of $1.05 billion of Medium Term Notes (the “Notes”), consisting of $300 million aggregate principal amount of 3.93% Medium Term Notes, Series 53, due 2029, $450 million aggregate principal amount of 4.16% Medium Term Notes, Series 54, due 2033 and $300 million aggregate principal amount of 4.46% Medium Term Notes, Series 55, due 2053. The Notes were offered on a best efforts basis in each of the provinces of Canada through a syndicate of agents.

This offering represents Hydro One’s first issuance of medium term notes pursuant to its new Sustainable Financing Framework and the largest issuance of sustainable bonds by a corporate issuer to date in Canada. Hydro One intends to allocate an amount equal to the net proceeds from the sales of the Notes to finance and/or refinance, in whole or in part, new or existing green and social projects that meet the eligibility criteria under its Sustainable Financing Framework. Prior to such allocation, the net proceeds may be initially used, in part or in full, for repayment of indebtedness or investments in bank deposits or other cash equivalents, in each case in accordance with Hydro One’s internal liquidity management policies. Although Hydro One intends to allocate an amount equal to the net proceeds from the sale of the Notes to eligible projects under the Sustainable Financing Framework, it will not be an event of default under the trust indenture governing the Notes if the company fails to do so.

Hydro One Limited, through its wholly-owned subsidiaries, is Ontario’s largest electricity transmission and distribution provider with approximately 1.5 million valued customers, approximately $30.4 billion in assets as at December 31, 2021, and annual revenues in 2021 of approximately $7.2 billion.

Osler, Hoskin & Harcourt LLP advised Hydro One Limited with a team consisting of Michael Innes, Rosalind Hunter, Amelia Miao, Desmond Christy and Jacqueline Kang (Corporate), David Davachi and James Chang (Tax), Samuel Cohen, Valérie Huard and Mélanie Proschek (Translation).

Value
$1.05 billion
Date Closed
January 24, 2023
Lead Office
Toronto
Key Contact
Michael Innes

Partner, Chair: Corporate, Toronto

Team
Rosalind Hunter

Partner, Corporate, Toronto

Amelia Miao

Partner, Corporate, Toronto

Desmond Christy

Associate, Corporate, Toronto

Jacqueline Kang

Associate, Corporate, Toronto

David Davachi

Partner, Tax, Toronto

James Chang

Associate, Tax, Toronto

Samuel Cohen

Associate, Translation, Montréal

Mélanie Proschek

Translator, Translation, Montréal

Valérie Huard

Translator, Translation, Montréal