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Italy: Infrastructure - Viveracqua Hydrobond 2024 closes fifth issue with total of €200 million

Investments in Veneto's water network are set to rise to around €2 billion over ten years

24 September 2024
Viveracqua
  • The funds raised will back a €340 million plan to modernise and improve the efficiency of Veneto’s integrated water service infrastructure.
  • Eight local companies are involved in the project: acquevenete, Alto Trevigiano Servizi, Azienda Gardesana Servizi, Etra, Livenza Tagliamento Acque, Medio Chiampo, Piave Servizi and Viacqua. These companies serve a total of around 400 municipalities and 3 million residents via a 30 000 km water network.
  • Banca Finint handled structuring and placement for the operation. The securities were fully subscribed by the EIB, CDP, Kommunalkredit and Volksbank with the SACE Archimede guarantee.

Viveracqua has made a fifth bond issue of €200 million as part of the Hydrobond initiative. Since 2014, and thanks to this latest placement, the total amount of investments activated for the modernisation and efficiency of the integrated water service infrastructure in Veneto will rise to around 2 billion. The issue was fully subscribed by the European Investment Bank (EIB), Cassa Depositi e Prestiti (CDP), Kommunalkredit Austria AG (Kommunalkredit) and Banca Popolare dell’Alto Adige (Volksbank) with SACE’s Archimede guarantee. Banca Finint acted as arranger and placement agent.

Set up as a private placement, the operation will provide innovative financing for the investment plans of the eight companies – acquevenete, Alto Trevigiano Servizi, Azienda Gardesana Servizi, Etra, Livenza Tagliamento Acque, Medio Chiampo, Piave Servizi and Viacqua – serving around 400 municipalities and 3 million residents via a 30 000 km water network. In concrete terms, works totalling around €340 million will be planned for the next three years to modernise and improve the efficiency of the network, in line with the principles of sustainable management of water resources (goal 6 of the United Nations 2030 Agenda) and to the benefit of the regions served.

The Hydrobond instrument has resulted in bond issues of almost €825 million since 2014 with the goal of supporting the growth and maintenance plans of Viveracqua’s member operators. These issues have helped unlock around €2 billion of investment on the ground, with a positive impact on the lives of the final beneficiaries and contributing to cutting water losses. The Hydrobond was partially backed by SACE’s Archimede guarantee, which supports loans and securities with a maximum term of 25 years but with no maximum amount, provided they are granted by the banking system to companies on market terms. The guarantee covers up to 70% of the amount.

Viveracqua President Monica Manto said: “We would like to thank the investors for their confidence in our ambitious sustainability projects, and for recognising the soundness and credibility of the joint work of Viveracqua’s 12 integrated water service operators and the effective industrial size the cooperation delivers. The financing linked to this fifth Hydrobond issue will provide €340 million to modernise networks and plants in Veneto and Friuli-Venezia Giulia. Over the last ten years, Viveracqua’s public companies have worked together to refine procedures, expertise and systems to make the most of these funding instruments and pursue each company’s growth and sustainability plans, with around €2 billion of new works to combat climate change.”

“This agreement once again confirms the EIB’s strong commitment to support the Italian water sector, to which we have provided over €3.75 billion in the last five years,” said EIB Vice-President Gelsomina Vigliotti. “Viveracqua Hydrobonds – in which we have invested since their first issue – show how sound governance and the use of structured finance can help small utilities to build up substantial resources to reinvest in combating climate change. This operation also fits perfectly with the capital markets union, which aims to facilitate companies’ access to new sources of finance, reducing their reliance on bank credit and supporting more sustainable and resilient economic growth.”

CDP CEO and General Manager Dario Scannapieco added: “Ten years after the placement of the first Hydrobond and with around €2 billion invested in the region’s integrated water services, this innovative operation is still successfully delivering real impact for families and businesses in Veneto. This new operation and the cooperation with other institutional investors consolidate our role in actively promoting efficiency and the construction of more modern strategic infrastructure able to manage water resources more sustainably in the future.”

Banca Finint Group Chairman Enrico Marchi said: “We are proud to participate in this new systemic operation, particularly as this is the fifth Viveracqua Hydrobond and Banca Finint has acted as arranger since the first issue in 2014. In recent years, we have worked with our partners and institutional investors to back Consorzio Viveracqua’s ambitious investment plans to make the regional water network more modern and efficient, making a decisive contribution to sustainable development in line with the Agenda 2030 principles. This operation also marks a historic milestone for Banca Finint. We are embarking on the tenth year of the basket bond, an innovative instrument and the first of its kind in Italy that we launched on the market in 2014. Applied to various domains and sectors, it has supported entrepreneurial growth across the country.”

SACE Chief Business Officer Valerio Perinelli commented: “This operation confirms SACE’s strong commitment to supporting investments in innovation, infrastructure and a sustainable transition in Italy with the Archimede guarantee. In concrete terms, we are particularly proud of this operation as it will make the water service in Veneto more efficient, thereby improving competitiveness. Our estimates indicate that there will be €220 million of production impact and €100 million in added value, and it will safeguard over 1 092 jobs.”

Kommunalkredit Senior Director Christoph Güntner said: “After our commitment to previous Viveracqua Hydrobond issues in 2020 and 2022, we are very pleased to participate in this major follow-up operation. Our repeated involvement in financing necessary water infrastructure modernisation and expansion work demonstrates the relationship of trust we have built with the Viveracqua consortium and other project partners, as well as our commitment to sustainable infrastructure investment that delivers real benefits to the community.”

Volksbank Head of Corporate Finance Matteo Costa concluded: “As north-eastern Italy’s regional bank, we are delighted to renew our commitment to developing and improving the efficiency of Veneto’s water network. The operation, which concluded with subscriptions to the innovative Hydrobond financial instrument, is in line with our bank’s I-mpact 2026 business plan, which includes support for the local area and connections with families and businesses as one of its key pillars. It is also aligned with the goals of the UN 2030 Agenda regarding the sustainable management of vitally important water resources.”

An ad hoc consortium of Banca Finint and Studio Legale Cappelli RCCD acted as arranger, placement agent and legal advisor for the operation. The EIB and CDP received assistance from Studio Legale Legance on a Chinese wall basis, while Kommunalkredit and SACE were assisted by two dedicated teams from Studio Legale Cappelli RCCD. Pirola Pennuto Zei assisted the managers in their deliberative processes.

Note to editors

Viveracqua is a company grouping together all the public water companies based in Veneto, with each providing water supply, sewerage and wastewater treatment services in its service area. Viveracqua member operators serve 580 municipalities (in Veneto and part of Friuli-Venezia Giulia) and a total of 4.7 million residents, with production value of over €1 billion. These members are: Acque del Chiampo, acquevenete, Acque Veronesi, Azienda Gardesana Servizi, Alto Trevigiano Servizi, BIM Gestione Servizi Pubblici, Etra, Livenza Tagliamento Acque, Medio Chiampo, Piave Servizi, Veritas and Viacqua.

The European Investment Bank (EIB) is the long-term lending institution of the European Union owned by its Member States. It provides long-term financing for sound investments that contribute to EU policy. The Bank finances projects in four priority areas: infrastructure, innovation, climate and environment, and small and medium-sized enterprises (SMEs). Between 2019 and 2023, the EIB Group provided €58 billion in financing for projects in Italy.

Cassa Depositi e Prestiti (CDP) is the national promotional institution that has supported the Italian economy since 1850. It is committed to accelerating the industrial and infrastructure development of the country in order to contribute to its economic and social growth. CDP’s core activity promotes sustainable regional development as well as the growth and innovation of Italian companies, including internationally. It partners with local authorities, providing funding and advisory services to build infrastructure and improve public utility services. It is also active in the field of international cooperation to implement projects in developing countries and emerging markets. Cassa Depositi e Prestiti is financed from entirely private resources via postal savings bonds and passbooks and through issues on the national and international financial markets.

Banca Finint Group is active in the Italian corporate and investment banking, structured asset management finance and private banking markets. Founded in late 2014, Banca Finint is the culmination of the more than 40 years of financial sector experience of the Finanziaria Internazionale Group, which was founded in 1980 by Enrico Marchi and other partners. Banca Finint Group was formed in 2016, with Banca Finint as parent company. Banca Finint specialises primarily in debt capital markets (minibonds and specialised lending) and the structuring and management of securitisation, covered bond and structured finance transactions, advisory for extraordinary finance transactions and the implementation of basket bond transactions, supporting local companies and the real economy where it operates. The group is based in Conegliano (Treviso) and has offices in Milan, Rome and Trento.

SACE is an Italian insurance and finance company directly controlled by the Italian Ministry for the Economy and Finance. It specialises in supporting companies and the country’s economy through a wide range of tools and solutions to boost competitiveness both in Italy and across the world. For more than 45 years, SACE Group has been the key partner for Italian companies that export and grow in foreign markets. It also supports the banking system, using its financial guarantees to make it easier for companies to access credit to support liquidity, investment in competitiveness and sustainability under the Italian Green New Deal, starting with the domestic market. SACE is present worldwide with 13 offices in target countries for Made in Italy, which have the role of building relationships with primary local counterparts and, through dedicated financial instruments, facilitating business with Italian companies. With a portfolio of insured operations and guaranteed investments worth €260 billion, SACE serves around 50 000 companies, mainly small and medium-sized enterprises (SMEs), supporting their growth in Italy and about 200 countries across the world.

Volksbank (founded in 1886) is based in Bolzano and is active as a regional bank not only on its local market of Alto Adige but also throughout north-eastern Italy in the provinces of Trento, Belluno, Treviso, Pordenone, Vicenza, Padova and Venice. It has over 160 operational branches and around 1 400 employees.

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2024-351-EN