Royal Philips has priced a €650 million fixed-rate green bond due 2034, becoming the healthcare industry’s first issuer of an EU Green Bond under the new European Green Bond Standard. The proceeds will finance taxonomy-aligned economic activities supporting Philips’ 2030 Impact Ambition.
Key Overview
- Bond value: €650 million
- Maturity: 2034
- Coupon: 4.0%
- Yield: 4.055%
- Issue price: 99.655%
- Oversubscription: 2.7 times
- Settlement: August 28, 2026
- Use of proceeds: Taxonomy-aligned economic activities
- Listing: Luxembourg Stock Exchange
- Credit ratings: BBB+ S&P, Baa1 Moody’s, BBB+ Fitch
Philips Prices €650 Million EU Green Bond
Royal Philips (NYSE: PHG, AEX: PHIA), a global leader in health technology, has successfully priced an offering of EUR 650 million fixed rate notes due 2034 under its European Medium Term Note (EMTN) program.
The issuance represents the healthcare industry’s first EU Green Bond under the new European Green Bond Standard, according to Philips.
The Notes carry a coupon of 4.0% with an issue price of 99.655%, resulting in a yield of 4.055%. The 7.8-year tranche was strongly received by investors and was oversubscribed by 2.7 times.
The transaction provides Philips with another source of long-term financing while supporting the company’s sustainability objectives.
Green Bond Proceeds to Support Taxonomy-Aligned Activities
An amount equivalent to the gross proceeds from the issue will be used to finance taxonomy-aligned economic activities, as referred to in the Philips European Green Bond Factsheet.
The financing will support Philips in delivering on its 2030 Impact Objectives.
The European Green Bond Standard is designed to establish a framework for green bonds and provide greater transparency around the environmental use of proceeds. For Philips, the new issuance places its financing directly within the healthcare sector’s transition toward activities aligned with European sustainability criteria.
Philips said the Notes are the first EU Green Bond issue from the healthcare sector that complies with the new European standard in this area.
Issuance Not Expected to Increase Net Debt
Philips said the issuance is not expected to result into an increase of net debt.
However, gross debt will be temporarily increased until the repayment of the company’s 2027 bond maturity in May 2027.
The transaction therefore forms part of Philips’ broader approach to managing its debt profile while maintaining access to long-term capital markets.
The company said it remains committed to maintaining a strong investment grade credit rating.
Philips currently holds a BBB+ rating from Standard & Poor’s, a Baa1 rating from Moody’s, and a BBB+ rating from Fitch, with all three agencies maintaining a stable outlook.
Strong Investor Demand
Investor demand for the new green bond was strong, with the 7.8-year tranche attracting orders equivalent to 2.7 times the deal size.
The strong demand highlights investor interest in Philips’ credit as well as in green bonds aligned with the European Green Bond Standard.
The €650 million Notes are expected to provide Philips with funding that can be directed toward eligible activities while supporting the company’s sustainability and impact objectives.
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Notes to Be Listed in Luxembourg
Settlement and issue of the Notes are scheduled for August 28, 2026.
Philips has applied for the Notes to be listed on the Official List of the Luxembourg Stock Exchange and to be traded on the regulated market of the Luxembourg Stock Exchange.
The final listing will provide investors with access to the securities through Luxembourg’s established regulated market.
Philips’ Position in the Healthcare Sector
The Netherlands-based health technology company generated approximately €18 billion in sales in 2025 and employs approximately 63,700 people.
Philips operates in more than 100 countries, providing health technology products and solutions.
The company’s latest green bond issuance adds a sustainability-focused financing instrument to its existing funding structure and supports its longer-term environmental ambitions.
The transaction also comes as European capital markets continue to develop standards aimed at increasing transparency and credibility in sustainable finance.
By issuing the first healthcare-sector EU Green Bond under the new European Green Bond Standard, Philips is positioning the transaction as part of its sustainability strategy while maintaining its focus on investment-grade financing.
Outlook
The €650 million EU Green Bond gives Philips long-term funding through a 2034 maturity while directing an equivalent amount of the proceeds toward taxonomy-aligned economic activities. With the issue strongly oversubscribed and no expected increase in net debt, the transaction combines green financing with active debt management.
The bond also marks a significant development for sustainable finance in healthcare as Philips becomes the first healthcare-sector issuer to issue an EU Green Bond under the new European standard.
FAQs
1. How much is Philips’ new EU Green Bond worth?
Philips has priced €650 million in fixed-rate Notes due 2034.
2. What is the coupon on the Philips green bond?
The Notes have a 4.0% coupon and a 4.055% yield.
3. What will the green bond proceeds finance?
An amount equivalent to the gross proceeds will finance taxonomy-aligned economic activities supporting Philips’ 2030 Impact Ambition.
4. When will the Philips green bond be issued?
Settlement and issue of the Notes are scheduled for August 28, 2026, with an application for listing on the Luxembourg Stock Exchange.
Sources: PHILIPS, StreetInsider, MarketScreener, Investing.com
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