Ghana has raised US$1 billion in its third Eurobond foray at a coupon rate of 8.125 per cent. The bond was largely oversubscribed, with orders reaching up to $3 billion.
Analysts say this is a mark of confidence in Ghana’s economy and is likely to boost the stability of the cedi.
Like the two previous issues, this year’s bond attracted investors from Europe, the United States, the Middle East and Asia.
The bond is a soft amortising one, amortising in 2024, 2025 and 2026, with principal repayment in three instalments of US$333 million in 2024 and 2025 and US$334 million in 2026.
According to a statement signed by the Minister of Finance, Mr Seth Terkper, and issued from New York yesterday, the notes would be listed on the Ireland and the Ghana Stock exchanges.
The bond was issued after a 10-day roadshow that took the Ghana team, led by Mr Terkper and Dr Henry Kofi Wampah, the Governor of the Bank of Ghana, to Munich, London, New York, Boston, Los Angeles and San Francisco.
At the end of the pricing in New York yesterday, Mr Terkper expressed his satisfaction with the bond issue and the processes that led to its success, saying, “Investors saw fundamental long-term value in the Ghanaian economy. We have always emphasised that the mid-term prospects for Ghana are bright, and with the coming on board of the IMF, we hope to come out of our short-term challenges pretty soon.”
He explained further that US$750 million would be used for capital expenditure, refinancing and counterpart funding requirements.
“An additional amount of about US$250 million would provide seed capital for the Ghana Infrastructure Investment Fund, which is scheduled to be launched in January 2015,” he said.
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