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Ghana Telecomm lands 200
million-dollar bond
Accra, Dec. 17, Ghanadot/GNA- The Management of Ghana
Telecommunications Company Limited (GT), has announced the
successful issuance of a 200 million-dollar corporate bond
facility.
This restores GT's financial flexibility and access to
vendor financing to support the company's much needed
programme of upgrading and extension of fixed and mobile
networks.
The bond adds no new debt to the company, representing a
balance sheet structuring exercise designed to refinance the
company's existing portfolio of maturing short term
commercial obligations and generally extending the maturity
profile of the company's debts.
The facility would significantly enhance the network's
operations, a statement issued by GT in Accra on Monday
said.
The amount is an aggregate principal amount of corporate
bonds to be issued and the first US Dollar denominated
Africa Corporate Bond outside South Africa and Nigeria.
The statement said the GT notes carried an 8.5 per cent
coupon and amortized annually in five equal instalments of
40 million dollars, maturing on 29 October 2012.
The GT notes were arranged by Iroko Securities Limited and
placed by Iroko Financial Products Limited and Exotix
Limited.
According to Mr Joe Owusu-Ansah, Acting Chief Financial
Officer of Ghana Telecom, "the successful placement of a
bond of this size is further confirmation of the wisdom of
our financing and business strategy which is principally
aimed at reversing the erosion of our market share and
indeed aggressively reclaiming our position as the leader in
the Ghana telephony market".
He explained that the high level of investor interest shows
that "the international capital markets share our view of
GT's potential and prospects and I am especially pleased
with the number of renowned investors that participated in
the transaction."
Mr Guy Essomé, Director, Structured Products, Iroko
Securities, said he was elated by the successful conclusion
of the arrangement.
He said "the transaction represents the first foray of a
Ghanaian corporate in the international capital markets."
Mr Guy Essomé said it comes closely on the heels of the
Government of Ghana's own Eurobond issue and was priced at a
1% yield spread above that of the Government of Ghana.
"This is proof of the purpose and the success of the
Government of Ghana Eurobond issue, one objective of which
was the ability to establish a benchmark against which other
domestic issuers could be priced," Mr Essomé said.
Mr Peter Bartlett, Managing Director of Exotix, described
the deal as "ground-breaking because Ghana Telecom is the
first corporate entity to issue a USD denominated bond in
sub-Saharan Africa, except South Africa."
Twelve investors took part in the transaction illustrating
that a large deal issued by an unrated borrower could be
successfully managed and distributed by smaller investment
banking houses like Exotix and Iroko Securities.
"We believe that this kind of African deal requires
specialist handling by entities that have an established
track record in Africa and a dedicated sales-team to handle
the challenge of distributing relatively illiquid product."
GT said the transaction was proof that it was possible for
large Ghanaian companies to diversify their source of funds
and investor base by accessing offshore markets without
government guarantee, in spite of the absence of a strong
partner which can lend its name to their credibility.
GNA
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