African banking conglomerate, Ecobank Transnational Incorporated (ETI) last week marked the successful listing of its bond on the main market of the London Stock Exchange (LSE). The company raised a total sum of $500 million in Eurobonds.
The Togo-based parent company of the Ecobank Group disclosed in a statement that it had secured an additional $50 million in Eurobonds from the international capital markets after raising $450 million in April. The bonds are consolidated into a single series and are due in April 2024.
ETI further said that the bonds have been placed with a broad range of institutional debt investors across Europe and Africa. Both Standard and Poor’s and Fitch have confirmed credit ratings of B and B- Stable respectively to this tap issue, in line with the company’s corporate rating. As a result, the issuance was met with strong appetite from investors in the United Kingdom (UK), United States (U.S.), Europe, the Middle East, Asia, and Africa, and was more than four times oversubscribed.
This demonstrates the interest of international investors in Ecobank’s prospect and confidence in its long-term strategy, Group Chief Executive Officer, Ade Ayeyemi said, adding that the success signals the “ability of African corporates to access international capital markets.”
In line with ETI’s strategic objectives, net proceeds from the issuance will be used for general corporate purposes including the refinancing of maturing debt facilities. More so, access to international capital markets will further strengthen the company’s liquidity profile as it looks to diversify funding sources and extend the average debt maturity profile.
“Our access to international capital markets are part of the mix and enable us to boost our liquidity profile, refinance maturing facilities and strengthen our foundations to ensure long-term sustainable growth and profitability for all our stakeholders,” the Acting Group Chief Finance Officer of Ecobank, Ayo Adepoju explained.
The latest Eurobond by ETI is the first debt sale on the LSE main market from a lender listed on the Nigerian Stock Exchange (NSE) since October 2017. It follows Ecobank’s previous convertible bond issuance on the International Securities Market in 2017, the company was quoted as saying by Nairametrics.
“As investor appetite deepens for emerging market offerings, we are positioned to offer the value that global investors seek. Our ability to open Africa to the world makes us a compelling choice. We appreciate the trust vested in us in continuing to build a strong independent African institution; a force for economic development in all of our operating markets,” Ayeyemi added.