Ghana Said to Sell $1 Billion of 15-Year Eurobonds at 10.75%

  • Government sold less debt, at a higher yield than planned
  • Debt has three equal redemption payments in final three years

Ghana sold $1 billion of 15-year Eurobonds at a higher yield than the government had sought during a roadshow last month.

The bonds are priced at 10.75 percent, according to a person familiar with the matter who isn’t authorized to speak publicly and asked not to be identified. About 40 percent is guaranteed by the International Development Association, a member of the World Bank Group. The debt matures in October 2030 and has three equal redemption payments in October 2028, October 2029 and October 2030.

The government continued to receive bids for as much as $1.5 billion of Eurobonds after a roadshow in September ended without the sale of the debt. The government was seeking bids for bonds with yields of 8.5 percent to 9 percent for 10-year debt, according to a person familiar with the government’s plans.

The yield on Ghana’s $1 billion Eurobond due in August 2023 rose 12 basis points to 10.84 percent on Wednesday.

The International Monetary Fund, which projects Ghana’s public sector debt will rise to 72 percent of gross domestic product by the end of 2015, wants the nation to reduce that level to restore macro-economic stability.

“It is very important that the authorities control the wage bill and minimize the risk of fiscal overruns from next year’s elections,” IMF Deputy Director of Fiscal Affairs Department Sanjeev Gupta said in comments published on the organization’s website.

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