Absa Capital Brings Corporate Bond to Market
Absa Capital joint lead manages R750m Barloworld Limited Bond Issue
Absa Capital, one of South Africa’s leading investment banks, today announced the issuance of a R750m Bond Exchange of South Africa (BESA) listed bond on behalf of Barloworld Limited (Barloworld).
This is the first prominent corporate long term bond issue for some time in the local debt capital markets, the previous being the Telkom Limited bond issuance in April this year. Absa Capital was the joint lead arranger in this transaction.
This year the local debt capital market has been dominated by State Owned Enterprises looking to fund ever increasing infrastructural requirements via long term debt capital market funding.
Today’s announcement follows hot on the heels of similar announcements earlier this year with Absa Capital, proving itself to be the preferred manager by bond issuers.
Notable debt issues arranged by Absa Capital this year include the Development Bank of South Africa, Airports Company South Africa, Telkom Limited, The South African National Roads Agency, City of Cape Town, Eqstra Corporation and Mercedes Benz South Africa.
This latest issuance by Barloworld, BAW2, is its second BESA listed bond - the first being the BAW1 (R1.5bn maturing in July 2011).
The BAW2 bond will be listed on BESA on the 2nd of October. The bond will pay a fixed rate coupon of 11.67% per annum, payable semi-annually.
Don Wilson, Financial Director at Barloworld said: “We are pleased with the level of interest shown by the investment community in our second bond offering. This funding should go a long way to improving the maturity profile of our total debt.”
Commenting on the announcement, Jacques Els, Head of Bonds, Convertibles and Hybrids at Absa Capital said: “It is encouraging to see the level of demand displayed by the local investment community for a credible corporate name such as Barloworld, particularly in this uncertain and challenging credit climate.”
Strong credit names which position their credit correctly should find strong support from the local investment community, added Els.
“Absa Capital continues to aggressively pursue the position as the country’s leading debt arranger and today’s announcement underscores that commitment” said Stephen van Coller, Head of Primary Markets at Absa Capital.
Absa Capital was appointed joint lead manager along with The Standard Bank of South Africa.
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About Absa Capital
Absa Capital, a division of Absa Bank Limited (Absa) and affiliated to Barclays Capital, is a leading South African investment bank with global reach, offering clients financing, risk management and advisory solutions in a wide range of currencies and structures across the globe.