Ghana sells $2bn Eurobonds at issuer-favoured yield

Ghana sold $2 billion worth of dual-tranche Eurobonds with 10- and 30-year maturities on Thursday and it will pay issuer-desired yields, government and transaction sources said.

The West African sovereign sold $1 billion each of the 10-year notes maturing in 2029 and a 30-year with 2049 maturity at 7.625 per cent and 8.625 per cent, respectively.

It set guidance for the May 2029 bond at 7.75 per cent to 7.875 per cent while the May 2049 was in the 8.75 per cent to 8.875 per cent range. The notes were first marketed in the low 8 percent area yield and low 9 percent mark.

Total books passed $5.5 billion, evenly split between the two tranches, lead advisers said.

“It’s a marked success for Accra because they got a low yield and a bigger size,” a sovereign debt market watcher told Reuters. “The pricing revision may have aided the deal and left investors unhappy.”

It was Ghana’s sixth sale since a 2007 debut.

Lead advisers for the sale were Bank of America Merrill Lynch, Citigroup, JP Morgan and Standard Chartered. Ghana is rated B3/B-/B

The government plans to use some of the proceeds to refinance debt and up to $750 million as revenue for its 2018 budget.

Ghana, which exports cocoa, gold and oil, is in its final year of a $918 million IMF credit deal to narrow fiscal deficit, inflation and public debt which hit 69 percent of gross domestic product in December.

The Thursday sale by Ghana followed similar big transactions by continental peers Angola, Kenya and Nigeria.