POSCO FUTURE M

- Having attracted a considerable sum of investment worth 1.55 trillion KRW thanks to the battery material business's growth potential, POSCO Chemical has doubled the issuance amount compared to its initial plan.
- In recognition of its ESG management performance through such efforts as the acquisition of Environmental Product Declaration certification, POSCO Chemical was granted “GB1,” the highest grade in green bond certification.

POSCO Chemical has decided to issue 400 billion KRW worth of bonds, twice as much as the initially planned amount of 200 billion KRW, as a result of its good performance in an ESG bond demand forecast.

POSCO Chemical increased the size of its bond issuance significantly when funds of 1.55 trillion KRW, 7.8 times its target amount, had been raised thanks to being evaluated as highly credible with a credit rating of AA- and also having high growth potential in a demand forecast for its ESG bonds that was conducted on the 15th.

With the issuance of additional bonds of 200 billion KRW on top of the initially planned amount, POSCO Chemical will be able to more efficiently carry out investments intended to strengthen its competitiveness in the battery material business, such as in building more production plants for artificial graphite anodes and securing raw materials for cathodes.

The bonds to be issued amount to 400 billion KRW, consisting of a three-year bond worth 250 billion KRW and a five-year bond worth 150 billion KRW, each of which will be issued at an interest rate lower than its individual privately rated interest rate. The interest rate for the 3-year bond is 0.25%p lower than its privately rated interest rate, while the interest rate for the 5-year bond is 0.30%p lower. The interest rates for the bonds will finally be determined by reflecting their individual privately rated interest rates as of February 22.
* Privately rated bond-specific interest rate: an average of rates calculated by private bond rating companies.

The fact that POSCO Chemical has drawn a considerable amount of investment in spite of reduced liquidity in the capital market resulting from factors including global rises in interest rates. This can in turn be construed as reflecting the expectations of the capital market that POSCO Chemical will continue to grow based on its technological prowess and differentiated competitive strengths, such as having secured a full value chain from raw materials to material production within the POSCO Group.

ESG bonds are issued for socially responsible investment, such as for environmental, social and governance improvement, and can be divided into green bonds, social bonds and sustainable bonds according to the purpose of use. POSCO Chemical issues green bonds for investment in eco-friendly businesses.

Prior to the issuance of the bonds, POSCO Chemical received the highest grade, “GB1,” in an ESG assessment for financial products conducted by the KIS this past January in recognition of the environmental improvement effect of its battery material business and the transparency of its fund management and disclosure.

The company’s acquisition of GB1 is thought to be the outcome of first establishing a roadmap to achieve carbon neutrality by 2035 for its battery material business and then making concerted efforts to reduce carbon emissions in its manufacturing procedures, such as acquiring Environmental Product Declaration certification for its cathodes and anodes and expanding the use of new and renewable energy. The KIS rated the performance of POSCO Chemical's ESG efforts as excellent, including its establishment of a responsible mineral management system and its social contribution activities based on its corporate citizenship management philosophy.

POSCO vice president Yoon Deok-il, who also serves as CFO of POSCO Chemical, said, “With the issuance of the ESG bonds, high expectations for our growth and the outcomes of our ESG management efforts have once again been recognized by our investors. We will continue with our efforts to strengthen the competitiveness of our battery material business and eco-friendly management.”

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