MILAN, Jan 11 (Reuters) - Telecom Italia (TIM) is preparing to raise up to 1 billion euros ($1.2 billion) with its first green bond, a source with knowledge of the matter said on Monday, as Italy’s biggest phone group strives to upgrade its networks.
The former phone monopoly is working to modernise its fixed and mobile grids, making them more energy-efficient and targetting carbon neutrality by 2030.
Green bonds allow borrowers to raise funds for projects that benefit the environment.
The source said the bond had an eight-year maturity and would be issued for up to 1 billion euros.
The initial indications on the price point to a yield of around 2.25%, equivalent to a spread of 255-260 basis points over the mid-market swap rate, the source added.
A market source confirmed the pricing details.
Banca Akros, BNP Paribas, Credit Agricole CIB, Deutsche Bank, UniCredit, Banco Santander, BBVA, Credit Suisse and UBI Banca are lead managing the bond sale.
$1 = 0.8207 euros
Reporting by Elvira Pollina, Sara Rossi and Stefano Bernabei. Editing by Valentina Za and Mark Potter