Africa Bonds

Benin is one step closer to issuing a planned Eurobond after Standard & Poor’s gave it a B+ foreign currency sovereign credit rating on Friday. The West African issuer had sent out a request for proposals (RFP) for a bond back in April.

Scandal-hit retailer Steinhoff International Holdings has asked its creditors for a three week extension to hammer out the final terms of a multi-billion euro debt restructuring.

The Islamic Development Bank has been meeting investors and banks in Europe to explore the possibility of launching its first public sukuk issue in euros. A labelled green sukuk might follow.

Two issuers from the CEEMEA region — Bulgarian Energy Holding and Ecobank Transnational Inc — have mandated banks for new bonds and are embarking on roadshows, breaking the wait-and-see mode that the market had slipped into over the last week.

Ecobank Transnational Incorporated, a pan-African banking group, is the only CEEMEA issuer to have publicly progressed with bond plans this week, setting the roadshow for its debut dollar bond. A syndicate official on the deal said that lead managers are confident of demand, but a rival questioned whether a single-B rated sub-Saharan issuer could reopen the market.

Unrealistic pricing expectations are keeping two EM corporate issuers by the wayside after volatile markets forced Atrium to cancel a tender offer combined with a new issue last week.

African debut issuer Vivo Energy was the only borrower from CEEMEA to make an official mandate announcement this week after sustained weakness in global markets kept seven others on the sidelines, but EM bankers are not predicting sustained periods of stability will return.

African debut issuer Vivo Energy, the sole distributor of Shell products on the continent, is beginning to market a $400m bond this week.

South Africa raised $2bn in a difficult market on Tuesday, after US Treasuries widened unexpectedly at just the moment that the sovereign began marketing its new deal. The resulting sell-off in both South Africa’s curve and the rand meant that the issuer was not able to tighten pricing as much as had been anticipated, and the deal was smaller.

South Africa had to contend with an unexpected widening in US Treasuries when marketing its new deal on Tuesday. The resulting sell-off in both South Africa’s curve and the rand meant that the issuer was not able to tighten pricing as much as had been anticipated, and the deal was smaller overall.

South Africa has opened books on its first sovereign trade this year and is looking to capitalise on goodwill towards president Cyril Ramaphosa’s economic transformation efforts. It hopes to offset the recent spread widening that has followed weakness in the rand — and in broader emerging markets — as a result of the stronger dollar.

The Republic of Ghana raised $2bn with a dual tranche 10 and 30 year bond issue on Thursday, timing the deal well as emerging market assets rallied after several days of weakness.