Ghana issues fifth Eurobond at 9.25 percent

Ghana has issued a $750 million Eurobond at a more favourable yield of 9.25 percent compared to its last sale, officials have said.

The country’s Finance Minister, Seth Terkper told the Reuters news agency that the sale was oversubscribed with orders exceeding $4 billion dollars – a development he said reflected investor confidence in the west African nation’s economy.

#Ghana issues $750 mn Eurobond with favourable yield https://t.co/wq3my0dkrQ pic.twitter.com/A58YGUAAaM

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The issuance of the bond is expected to bring in much needed cash to balance the government’s budget ahead of presidential and parliamentary elections scheduled for December, in which president John Mahama is seeking a second term in office.

The sale of the latest Eurobond, the fifth comes on the heels of the commissioning of a new oil field with an expected production capacity of up to 25, 000 barrels per day.

An earlier attempt to launch the bond in August was aborted due to higher than expected yields demanded by investors, and after the country’s parliament passed a law allowing central bank financing contrary to IMF restrictions.

Ghana’s fifth Eurobond, according to Ghanaian news portal, myjoyonline.com attracted investors from the United Kingdom, Europe, the United States, Middle East and Asia. The notes, the website said will be listed on the Irish and Ghana Stock Exchanges.

The bond with a weighted average life of five years, is expected to be used mainly to refinance a 2017 debt issue. Repayment will be over three years from 2020 to 2022.

Ghana also announced a further tender of its 8.5 percent 2017 notes and Tekper said the government was aiming to buy back about $400 milion after it bough back around $100 million last month, reports Reuters.