Orkuveita Reykjavíkur (OR; Reykjavik Energy) will conduct an auction of a new inflation linked green bond series, OR 020934 GB, on August 27th 2019.
The new series has a maturity of 15 years, pays a fixed real-interest rate and will be listed on the Nasdaq Iceland Sustainable Bond market. The series has a semiannual annuity amortization schedule and a final maturity on September 2nd 2034.
The auction will be closed and structured as a single-price auction, which means that all accepted bids will be offered to investors at the same price. The lowest accepted price (highest yield) will determine the selling price. OR reserves the right to accept any of the submitted bids, in whole or partially, or reject all of them. The results of the auction will be published no later than the next business day. Fossar Markets manage the auction process on behalf of OR and will handle investor relations.
Market making agreement
Orkuveita Reykjavikur has signed an agreement with Arion Banki hf., Íslandsbanki hf., Kvika banki hf. and Landsbankinn hf. to be designated market makers of the new series. The agreement is valid from the bond series‘ first day of trading, which is expected on September 2nd.
Market makers are obligated to enter buy and sell offers for the new series on the NASDAQ OMX Iceland exchange before the opening of the market. Offers should always be at a minimum of 20m ISK nominal amount and shall be renewed not later than 15 minutes after they have been accepted. The maximum spread between buy and sell offers can be 1.0% and is determined by the price of valid offers. Market markers are however allowed to deviate from the maximum buy-sell offer spread while the total series size remains below 2bn ISK. Should a single market maker, within a single trading day, have a turnover of more than 60m ISK of nominal amount in the new series in automatic trades, that market maker can deviate from the maximum buy-sell offer spread until the end of the trading day for the bond series.
In addition, on September 2nd, market making agreements relating to the OR090524 series will be discontinued as no further bonds are to be issued in those series due to inflation-linked loans minimum terms regulations. Market making agreements for the OR090546 series will remain unchanged.
For further information please contact:
Ingvar Stefánsson
CFO
Tel: +354 516 6100
Email: ingvar.stefansson@or.is
Matei Manolescu
Fossar Markets
Tel: +354 522 4008
Email: matei.manolescu@fossarmarkets.com