The Ministry of Finance and Economic Planning (MoFEP) has signed the final agreements on the US$1 billion Eurobond with Dentons, the external legal advisors on the country’s second Eurobond issue.
The documents signed were the subscription agreement, Deed of Covenant, Paying Agency Agreement, Unrestricted and Restricted Global Note, Citi Exchange Agency Fee Letter and the Citi Paying Agency Fee Letter.
The signing of the documents means that the country has agreed to the terms and conditions of the bond issued on Thursday, July 25, 2013.
It also makes it possible for investors to exchange US$250 million of the current bond proceeds for the old sovereign bond, which was issued in 2007.
This means that US$750 million from the US$1 billion raised through the current Eurobond issue will be available to the government to be used to support the country’s development agenda.
The Minister of Finance and Economic Planning, Mr Seth Terkper, signed on behalf of Ghana, with Dentons being represented by Mr Martin Kitchen, Madam Mary Boakye, Mr David Cohen and Madam Laura Cannadale.
Mr Terkper said prior to the signing, Ghana was in a transition to growth and would, therefore, make good use of all available opportunities to raise capital to support its development needs.
He also mentioned the government’s intention to remain on the international capital market as it looked for ways of raising funds to meet its growing infrastructure and other development needs.
Madam Boakye, who is Dentons’ Africa consultant, said the law firm would continue to be of service to Ghana as and when the need arose.
He assured Ghana of her outfit’s support, stating, “We want to get the best for Ghana.”
The signing of the bond documents brings to an end the process that the government started a couple of months ago to raise US$1 billion from the international capital market.
The bond, which was issued on Thursday, July 25, was oversubscribed by US$1.2 billion at a coupon rate of 7.875 per cent.
Its proceeds are to, among other things, help retire maturing debts, support infrastructure development and meet capital expenditure captured in this year’s budget.
The bond is to be listed on the Ghana Stock Exchange (GSE) and the Irish Stock Exchange (ISE), making it the first Eurobond in sub-Saharan Africa to be listed on the local and the international bourse.
By Lloyd Evans, London