Angolan Officials Meet Bond Investors in London, Aberdeen Saysby and
Ministers of finance, petroleum lead delegation: Aberdeen
Yield on Angola’s 2025 dollar bond tumbles as oil rebounds
Angolan officials met bond investors in London this week as Africa’s largest oil producer looks at options for raising money abroad to counter an economic slump.
Finance Minister Armando Manuel, Minister of Petroleum Jose Maria Botelho de Vasconcelos and officials from the central bank were meeting investors this week, according to Patty Cao, a research analyst at Aberdeen Asset Management Plc in London, which oversees about $10 billion of emerging-market debt. She said she attended a non-deal roadshow on July 14.
The meetings come after the country’s borrowing costs tumbled amid a rebound oil and signs central banks in major economies will keep interest rates low, boosting demand higher yielding debt. Angola, whose economy is forecast to grow at the slowest pace in 14 years, called off aid talks with the International Monetary fund last month.
Finance Minister Manuel said Angola doesn’t need IMF money given the recent rise in oil, according to Richard Segal, an analyst at Manulife Asset Management, who said he met the minister on Friday. The government hopes to raise $900-$950 million of funding before the end of the year and is discussing options with different banks, Segal said.
London-based Gemcorp Capital LLP is negotiating a $500 million loan with Angola, according to a person familiar with the matter, who asked not to be identified as the talks are private.
The yield on $1.5 billion of bonds due November 2025 has dropped 352 basis points from a peak on Jan. 20 to 10.07 percent on Friday. Brent crude has climbed about 70 percent in the same period.
Angola’s economy will probably grow 1.3 percent this year, the slowest pace since 2002, according to government estimates and World Bank data. While crude gained this year, it’s still down 55 percent in the past two years, cutting revenue for a country that relies on oil for about 95 percent of its export income. President Jose Eduardo dos Santos said the nation is generating “barely enough” revenue to pay debt in a July 1 broadcast on state television.