In Africa’s largest Eurobond issuance since the onset of the Covid-19 pandemic, Rand Merchant Bank (RMB), the corporate and investment banking arm of FirstRand Bank Limited, acted as joint lead manager and joint bookrunner (JLM), alongside other transaction parties, in the Republic of Ghana’s four-tranche Eurobond. RMB also acted as dealer manager on Ghana’s tender offer on its 2023 maturity Eurobonds. RMB is proud to have assisted Ghana to issue a new money Zero coupon senior unsecured Eurobond, the first of its kind by an emerging market (EM) sovereign.
Ken Ofori-Atta, Ghana’s Minister for Finance, who was sworn in on 30 March 2021, has in the past made a case for the creation of an “inclusive global forum to rebuild the international financial and economic architecture and a new ability to respond equitably and rapidly to such a catastrophe”. The effective execution of the zero-coupon Eurobond tranche is another step towards achieving this vision and helps to create additional fiscal space to assist Ghana to build back better post the Covid-19 impact on the economy.
This issuance enables the Ministry of Finance to raise funds to refinance more expensive shorter-dated debt with affordable term debt. This transaction was preceded by a three-day virtual deal roadshow, where Ghana presented its impressive credit story to the global fixed income investor base, whilst emphasising the government’s focus on fiscal consolidation, completion and continuity as the economy recovers from the impact of the pandemic.
Commenting on the transaction, Philip Chapman, RMB Namibia CEO said: “This is a landmark transaction and creates fiscal space for the government of Ghana to make health-related investments and support growth. The tender offer associated with the transaction also demonstrates that global markets are open to helping emerging market issuers refinance near-term maturities to allow issuers to preserve precious cash for investments in post-pandemic recovery agendas. RMB is pleased to have been able to assist the government of Ghana to achieve its goal on this transaction. The issuance further demonstrates the RMB debt capital markets team’s expertise, innovation and ability to execute amidst a volatile market backdrop.”
“Our agility in turning around the transaction within a short period enabled Ghana to navigate the choppy waters in the markets and achieve the government’s objectives in terms of their debt management strategy. The services of RMB’s leading debt capital markets team, based in London, a key financial hub, remains available to African issuers to help them direct capital into the continent for investment, growth and development,” added Dominic Adu, CEO of First National Bank Ghana.
Sharing their views on the deal, Eyitayo Netufo, Head of International Debt Capital Markets and Harris Hadjitheoris, Head of Bond Syndicate at RMB, said: “It was a pleasure working with the market astute government of Ghana’s deal team as they expertly executed the advice of the bookrunners on the transaction, which enabled a very successful deal despite the volatile market backdrop.”