Sri Lankan renewable energy company WindForce PLC has withdrawn its proposed Rs. 4 billion Green Bond issue, citing prevailing adverse market conditions. The company had initially announced plans in April 2026 to issue up to 40 million listed, rated, senior, unsecured and redeemable green bonds. However, changing market conditions led the company to withdraw its initial listing application before the bonds reached the market.
Key Overview
- WindForce PLC has withdrawn its proposed Rs. 4 billion Green Bond issue.
- The company cited prevailing adverse market conditions.
- The original proposal was announced on 2 April 2026.
- WindForce had planned to issue up to 40 million green bonds.
- The bonds were proposed at Rs. 100 each.
- The issue was subject to regulatory and other approvals.
- Details on tenure, interest rates and other terms had not been disclosed before the withdrawal.
WindForce Withdraws Proposed Green Bond
WindForce PLC has shelved plans to raise Rs. 4 billion through a proposed green bond issue.
The renewable energy company withdrew its initial listing application for the planned bond offering, citing prevailing adverse market conditions.
The decision means the proposed green bonds will not proceed to market placement under the current plan.
The withdrawal was formally communicated through a corporate disclosure to the Colombo Stock Exchange.
Original Bond Proposal
WindForce first announced the proposed green bond issue on 2 April 2026.
At the time, the company’s board had resolved to issue up to 40 million listed, rated, senior, unsecured and redeemable green bonds.
The proposed issue had a total value of up to Rs. 4 billion and was subject to obtaining the necessary regulatory and other approvals.
The company had planned to issue the bonds at Rs. 100 each.
However, the original announcement did not provide details on the bonds’ tenure, interest rates or other specific characteristics.
Market Conditions Change
WindForce’s decision to withdraw the issue comes several months after the initial announcement.
The company did not proceed with the debenture offering because of the prevailing market environment.
The proposed bonds were withdrawn before market placement, meaning investors did not receive the opportunity to subscribe to the planned issue.
The change illustrates how market conditions can affect corporate fundraising plans, particularly when companies are seeking to raise debt through capital markets.
Interest Rates Affect Corporate Borrowing
The market environment has also changed since WindForce announced the bond proposal.
Benchmark interest rates have increased, affecting the cost companies face when raising debt.
When benchmark rates rise, corporate issuers may need to offer higher coupons to attract investors compared with government securities. This can increase the overall cost of borrowing.
The Central Bank of Sri Lanka raised its Overnight Policy Rate by 100 basis points to 8.75% in May.
Inflation subsequently accelerated to 8% year-on-year in August, adding further pressure to the broader interest-rate environment.
Treasury Yields Also Move Higher
Government securities have also been experiencing higher yields.
At a recent Treasury Bill auction, weighted average yields increased across all maturities for a second consecutive week.
The 364-day yield up 5 basis points to 9.93%, adding to the borrowing environment facing corporate issuers.
Higher government security yields can influence how investors assess corporate debt because companies generally need to offer competitive returns to attract capital.
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Green Bond Plans Remain Shelved
WindForce’s withdrawal does not change the company’s renewable energy focus, but it does remove the proposed green bond as a source of funding under the current plan.
The company has not announced new terms for the proposed bonds following the withdrawal.
The original issue was structured as a listed, rated, senior, unsecured and redeemable green bond.
However, details regarding the bonds’ tenure, interest rates and other characteristics had not been finalised publicly before the proposal was withdrawn.
No Market Placement Took Place
The timing of the withdrawal is important because the bonds had not yet reached market placement.
The company withdrew its initial listing application before the proposed securities were offered to investors.
This means the proposed Rs. 4 billion fundraising will not proceed under the terms originally announced in April.
The company has also not disclosed a replacement financing structure as part of the withdrawal announcement.
What the Withdrawal Means
For WindForce, the decision removes a planned source of capital that could have provided additional funding through the green bond market.
For Sri Lanka’s sustainable finance market, the development also highlights the importance of prevailing capital-market conditions when companies seek to raise funds through labelled debt instruments.
Green bonds generally connect borrowing with eligible environmental or sustainability-related activities, making market conditions particularly important for renewable energy companies seeking financing through this channel.
WindForce’s withdrawal shows that even when a company has announced a proposed green financing structure, the transaction can still be affected before reaching investors.
Outlook
WindForce PLC has shelved its proposed Rs. 4 billion green bond issue after determining that prevailing market conditions were not favourable for proceeding with the transaction.
The company had initially planned to issue up to 40 million bonds at Rs. 100 each, subject to regulatory approvals, but withdrew its listing application before market placement.
The decision comes against a backdrop of higher interest rates, increased inflation and rising Treasury yields, all of which can influence the cost and attractiveness of corporate debt issuance.
For now, WindForce’s proposed green bond remains withdrawn, while the company has not disclosed whether or when it could revisit the fundraising plan under different market conditions.
FAQs
1. Why did WindForce withdraw the green bond?
WindForce withdrew the proposed issue because of prevailing adverse market conditions.
2. How much was WindForce planning to raise?
The company was planning to raise up to Rs. 4 billion through the proposed green bond.
3. How many bonds were originally proposed?
WindForce planned to issue up to 40 million listed, rated, senior, unsecured and redeemable green bonds.
4. When was the green bond originally announced?
The original proposal was announced on 2 April 2026.
Sources: The Morning | Daily FT | Hiru News
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