Jordan plans to raise $500 million from its second international bond sale this year, just days before another Eurobond matures.
The kingdom is offering bonds due in January 2026 with an indicative yield of around 6.75 percent, according to a person with knowledge of the matter, who asked not to be identified as the information is not yet public. Jordan has $750 million of debt due Nov. 12, according to data compiled by Bloomberg. That bond was issued in 2010 with a coupon of 3.875 percent.
“I would expect the issue to go very well given indicative terms,” said Richard House, the head of emerging-market debt at Standard Life Investments in London. “Policy makers have done a good job in recent years managing the economy against a backdrop of significant challenges in the region. Jordan rarely issues so there will be a degree of scarcity value."
Maintaining security and reviving the economy are the main challenges to Jordan, a key U.S. ally bordering one of the world’s deadliest conflict zones. The kingdom is barely coping with an influx of 1.5 million Syrians refugees, while the bulk of its overland trade with Europe has been choked off after the closure of the remaining route through Syria.
The country also raised $1.5 billion in U.S.-backed bonds earlier this year, selling seven-year $1 billion bonds and 10-year $500 million notes with coupons of 2.578 percent and 3 percent, respectively. The U.S. had already guaranteed a combined $2.25 billion for the kingdom since 2013.
Jordan is rated BB- by Standard & Poor’s, three levels below investment grade. Citigroup Inc. and JPMorgan Chase & Co. are managing the sale, which follows fixed-income investor meetings in London, New York, Boston and Los Angeles.