GHANAIAN GOVT APPOINTS FIDELITY, STANCHART LEAD MANAGERS FOR BOND ISSUE

ACCRA, The Ghanian government has appointed Fidelity Bank and Standard Chartered Bank as Joint Lead Managers for a bond issue totalling about 10 billion Ghana cedis (about 2.27 billion US dollars), the Ministry of Finance said Thursday.

The size of the issuance, which will be backed by the Energy Sector Levy Act (ESLA), is estimated to be the amount of the total estimated legacy debt within the energy sector. The two banks were selected after government evaluated 10 proposals for transaction advisers.

The statement said the Joint Lead Managers were expected to work closely with members of their respective syndicates/consortia and any other local bank or financial institution as co-managers with the view to building capacity locally and facilitating knowledge transfer.

The Lead Managers on behalf of the government willl set up a Special Purpose Vehicle, ESLA-SPV, to issue long-term bonds on the back of ESLA receivables assigned to the SPV, which shall be listed on the Ghana Stock Exchange (GSE).

The statement said a portion of the bond proceeds shall also be used to re-finance previously restructured debt due banks currently being repaid with ESLA receivables, as well as the debt owed to banks by the Bulk Oil Distribution Companies (BDCs).

The statement said the Energy bond issuance, the proceeds of which would be used to repay the legacy debt of the energy sector State-owned enterprises (SOEs), is in line with Ghana’s strategy as stated in the Budget Statement and Economic Policy of Government, to streamline ESLA flows to resolving the various issues within the energy sector, which had led to intermittent power supply and high tariffs, as well as to provide liquidity to the banking sector.

Source: NAM NEWS NETWORK

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