Following the recent buy-back arrangement by E.S.L.A. Plc, investors has overwhelmingly subscribed to the company’s latest issuance, 10-year cedi denominated bonds, which will mature on June 15, 2029.
Bids of GHc 1.147 billion were submitted with yields ranging from 19.50 percent to 19.90 percent out of which GHc 1 billion was accepted at a coupon rate of 19.85 percent.
Proceeds from the GHc 1 billion bond issuance will be used to settle portions of the outstanding legacy debt and other obligations due suppliers and other creditors within the energy sector.
This brings the total issuance under the GHc 10 Billion Bond Programme to GHc 6.665 billion.
The outstanding amount on E.S.L.A. Plc bonds in issuance is GHc 6 billion comprising GHc 2.260 billion, GHc 2.740 billion and GHc 1 billion for the 2024, 2027 and 2029 bond maturities respectively.
E.S.L.A. Plc on Tuesday, June 25, 2019 undertook a buyback exercise during which GHc 446.453 million worth of bonds were bought back from bondholders of the 2024 and 2027 maturities.
This buyback together with a previous buyback of GHS 218.267 million, amount to a total of GHc 664.720 million in bond buybacks which have subsequently been cancelled from the legacy debt books.
E.S.L.A. Plc is expected to continue to undertake periodic buyback and cancellation of outstanding bonds using proceeds in the Lock Box Account via open market operations.
E.S.L.A. Plc collections received In the Receivables Account towards the service of the bond programme for the five month period ending 31 May 2019 amount to GHS 711.333 million.
The 2018 Annual Report on the Management of the Energy Sector Levies and Accounts, indicates that for 2019, a total of GHc 3, 947.82 million has been targeted for collection under the Energy Sector Levy Act, (ESLA) representing an increase over 2018 collections of GHc 440.78 million, and 12.6 percent higher than the targeted amount for last year of GHc 3,507.04 million.
If this target is met it will enable faster resolution of the energy sector’s problematic legacy debts and increased pace of direly needed power generation and transmission infrastructure as well as improved road maintenance.
(By Joshua W. Amlanu)