Africa Bonds

South Africa is turning its attention to the domestic sukuk market following its international debut last year, the head of the country’s debt issuance department told GlobalCapital Emerging Markets.

South Africa is turning its attention to the domestic sukuk market following its international debut last year, the head of the country’s debt issuance department told IFIS.

Citi has promoted Aziz Rahman to head of corporate finance for sub-Saharan Africa, filling the role left vacant by Martin Mugambi late last year when he moved to become CCO of Zambia.

Despite the strong success of several emerging market issuers — Halkbank, National Bank of Abu Dhabi, and Eustream — with bonds last week, other borrowers have refrained from issuing so far this week, leaving the focus on liability management, mandates and roadshows.

The Republic of Cameroon has picked Société Générale and Standard Chartered Bank to arrange a bond, which looks likely to be up to $1.5bn.

Struggling South African electricity provider Eskom paid up to 40bp new issue premium to place its $1.25bn 10 year bond on Thursday. Investors responded positively to the offer, despite the ongoing problems faced by the state owned company, according to bankers.

South Africa's Eskom is on track to price its first bond since 2013 and is talking a new 10 year at mid-7%. Investors have responded positively to the offer so far, despite the ongoing problems faced by the state-owned electricity provider, according to bankers.

Commerzbank is opening a representative office in Abidjan, the economic hub of Ivory Coast, and has appointed Konrad Engber as head of the five person team. He had previously been Commerzbank’s representative in Addis Ababa, Ethiopia, and Tripoli, Libya.

Afren, the Africa-focused oil exploration company listed on the London Stock Exchange, has avoided default on a $300m loan after obtaining a deferral from banks on the $50m amortisation payment that was due on Saturday January 31 for its Ebok debt facility.

Standard Bank has closed a sale of 60% of its markets business to Industrial and Commercial Bank of China, a deal which the bank will use to further “the group’s growth strategy in South Africa, and across the African continent.”

African sovereign sukuk issuance could grow in the next two years, Bank of London and the Middle East (BLME) believes. But other analysts predict only one or two Africa sovereigns will follow South Africa into the international sukuk market.

Egypt is preparing to follow Tunisia’s landmark return to the international bond market as investors shrug off conflict in Syria and the oil price’s collapse to regain appetite for Middle Eastern credits. Underscored by this week’s $1bn deal, confidence in the region has rebounded to levels last seen before the Arab Spring in 2011, writes Virginia Furness.