The African Export-Import Bank (Afreximbank) has closed a $750 million bond after achieving an order book of $3.4 billion from 290 investors, the largest ever to be achieved by the Bank in the international debt capital market.
The bond, which closed in London on 17 May, is a five-year Reg S Only Bond Note due in May 2021 and paying a coupon of four per cent, was issued under Afreximbank’s existing Euro Medium Term Note Programme. It was priced at a spread of MS+300bps and will be deployed by Afreximbank to finance trade in Africa and for other strategic activities.
“The level of subscription and diversification of investors in this transaction attests to the continued strong investor confidence in Afreximbank,” said Bank President Dr. Benedict Oramah.
The President, who welcomed the fact that the deal achieved negligible new issue premium, noted the solid geographic spread of the final allocation with 36 per cent going to Asia; four per cent to the Middle East; 48 per cent to the United Kingdom/Europe; and 12 per cent to the United States (off-shore accounts).
Prior to pricing the transaction, Afreximbank had embarked on comprehensive roadshows across Asia, the Middle East, continental Europe and the United Kingdom, meeting more than 60 investors in the process.
In the Bank’s view, the strong feedback received during the roadshows is a testimony of investors’ confidence in Afreximbank’s credit profile and strategy, in particular, their satisfaction with the stable ratings outlook as a result of its successful equity capital raising efforts.
Afreximbank’s partners in arranging the transaction were Mitsubishi UFJ Securities International plc. as Sole Coordinator and Joint Lead Manager/Book Runner; Barclays Bank PLC as Joint Lead Manager/Book Runner; HSBC Bank plc. as Joint Lead Manager/Book Runner); Rand Merchant Bank, a division of First Rand Bank Limited, London Branch, as Joint Lead Manager/Book Runner; and Standard Chartered Bank as Joint Lead Manager/Book Runner.