Stellantis N.V. (NYSE:STLA) announced it has priced a multi-tranche hybrid bond offering worth €5 billion (about $5.8 billion), accessing capital markets shortly after booking major charges tied to changes in its electric vehicle strategy.
The bond sale follows the company’s recent announcement that it would record €22.2 billion in impairments after scaling back its electric vehicle expansion plans. Chief executive Antonio Filosa said the shift reflects earlier overestimates about how quickly consumers would adopt fully electric vehicles.
As part of its financial strategy, Stellantis had indicated it would issue up to €5 billion in non-convertible subordinated perpetual hybrid bonds to support liquidity and maintain a strong balance sheet.
The offering, executed on Tuesday, included three separate tranches. These consisted of €2.2 billion in perpetual fixed-rate resettable notes with a 5.25-year non-call period and a 6.25% coupon, €1.8 billion in perpetual notes with an 8-year non-call period and a 6.875% coupon, and £865 million (about $1.16 billion) in perpetual notes with a 6.5-year non-call period carrying an initial coupon of 8.25%.
“This issuance will further strengthen Stellantis’ capital structure and liquidity position,” the company said in a statement.
Settlement of the bonds is expected on 16 March.
The carmaker—which owns brands including Jeep, Peugeot, Ram, Chrysler, Fiat and Citroën—is shifting its product focus toward hybrid and internal combustion models. The change marks a move away from the EV-focused approach pursued by former chief executive Carlos Tavares, with management noting that demand for fully electric vehicles has grown more slowly than earlier forecasts, particularly in the United States.
Stellantis is scheduled to present its updated long-term business strategy on 21 May.