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Ghana Offers Juicy Yields On Bonds
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Finance Minister, Ken Ofori-Atta
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Ghana hopes to become the next African sovereign to issue a jumbo deal in the US dollar market despite a deteriorating backdrop after Angola sold a bigger-than-expected offering on Wednesday.

Ghana – whose 2022s are the best-performing hard-currency African bonds this year in terms of total return – plans to issue 10 and 30-year notes after completing a road show on May 8.

The sovereign is also seeking to buy back up to US$1.5bn of its 2022s and 2023s through a tender offer.

Ghana also has 2026s and 2030s outstanding, the former bid at 7.36% and the latter at 7.45%.

Finance Minister Ken Ofori-Atta told Reuters last month that the government was looking to issue the bonds, presumably the 10-year, with a coupon in the 7% range.

That may be optimistic but Ghana (B3/B-/B) should get a good reception, continuing the strong bid seen on other African sovereigns in the US dollar market this year.

Egypt, Kenya and Nigeria all got big order books with their deals in February, as did Angola last week, thanks to the yields on offer and the fact that these are index-eligible trades.

Angola (B3/-/B) sold a US$3bn dual-trancher – US$1bn more than it was targeting – at the tight end of guidance for both tranches.

Angola began marketing its notes at a cheap level, offering a 10-year bond at 8.50% area and a 30-year at 9.625% area.

The IMF recently approved the next disbursement of about US$191m under Ghana’s aid programme, while urging the government to take further steps to address its high debt.

The sovereign is in its final year of the US $918m credit deal signed in April 2015 to fix its economy, dogged by high deficits, inflation and a distressing public debt.

Ghana’s trade is being led by Bank of America Merrill Lynch, Citigroup, JP Morgan and Standard Chartered.

Deutsche Bank, Goldman Sachs and ICBC were the joint book-runners for Angola.
Source: Reuters

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