Africa Finance Corporation ('AFC'), a leading pan-African multilateral development finance institution and project developer, has issued a US$500 million 7 year Eurobond.
The senior, unsecured Eurobond which carries a coupon of 3.875% was priced to yield 4.000% and matures in April 2024.
The Eurobond received strong global interest, with an order book of US$2.4 billion, representing about 5 times over-subscription from 231 investors across the Middle East, Asia, the United Kingdom, Europe and the United States. Prior to the launch of the bond, AFC conducted a roadshow in London, Hong Kong, Singapore, the UAE, and the United States.
The bond is AFC's second benchmark Eurobond issuance under the Corporation's US$3 billion Global Medium Term Note Programme. The bond was rated A3 by Moody's Investor Services which is in line with AFC's issuer rating. The bond will be listed on the Irish Stock Exchange. The Eurobond was distributed to investors in Europe (29%), United States (25%), United Kingdom (24%), Asia (18%) and the Middle East (4%).
AFC is only the second African development finance institution to issue a Eurobond with maturity longer than 5 years, reflecting AFC's strong credit standing and its ability to match-fund medium to long-dated infrastructure investments.
Commenting on the issue, Andrew Alli said: "AFC has been committed for the last ten years to investing in projects that drive sustainable growth and development in Africa. In that time, we have invested over US$4 billion in 28 African countries.
"Key to delivering this are our fund-raising activities around the world, promoting the very real investment opportunities that exist in African infrastructure. The strong interest in this bond reflects investors' confidence in AFC's credit, strategy and risk management culture, as well as appetite for exposure to the returns available in African markets."
Commenting on the issue, Banji Fehintola, Director & Corporate Treasurer of AFC added: "After a successful debut Eurobond issuance in 2015, AFC has consistently engaged investors through a series of non-deal roadshows and other debt capital market issuances. The tremendous success of our second Eurobond issuance attests to the fact that investors continue to seek exposure to high quality, investment grade credits like AFC. This is indeed a solid endorsement of AFC's strong business fundamentals, governance, funding strategy and risk management."
The Eurobond issue follows a solid track record of successful capital market issuances starting with AFC's debut US$750 million Eurobond issued in April 2015. The 2015 Eurobond was priced to yield 4.595% for a five-year tenor and matures in April 2020.
Last year, AFC issued its debut senior unsecured long three-year Swiss Franc (CHF) denominated bond, raising CHF 100 million, and earlier this year, issued its maiden US$ 150 million three year Sukuk, the highest-rated ever Sukuk issuance from an African institution and the first Sukuk to be issued by an African supranational entity.
On 15th - 16th May 2017, AFC will celebrate its 10th anniversary at AFC Live, Africa's premier infrastructure summit, which will bring together the top international players in African infrastructure investment for high-level discussions on the industry's many challenges, and potential solutions.
Citi, J.P. Morgan, MUFG and Standard Chartered Bank acted as Joint Lead Managers and Bookrunners for the U.S. dollar-denominated Rule144A/Reg. S issue.