By Rebecca Melvin
New York, Sept. 20 – The Republic of South Africa priced $2.5 billion of notes in two tranches, including $1 billion of 4.85% 10-year notes and $1.5 billion of 5.65% 30-year notes, both priced at par, according to a term sheet.
The South Africa notes priced tighter than talk, which was 4 7/8% to 5%, guided down from the 5% area, for the 10-year notes, and 5¾% to 5 7/8%, tightened from the 5 7/8% area initially, for the 30-year notes.
The yield spread for the 2027 notes is 260.5 basis points over U.S. Treasuries, and the spread on the 2047 notes is 283.7 bps over the U.S. Treasury 30-year benchmark.
Citigroup Global Markets Inc., Deutsche Bank AG, London Branch/Nedbank Ltd. and HSBC Bank Ltd. are joint bookrunners of the Securities and Exchange Commission-registered offering, and Absa Bank Ltd. is co-lead manager. Settlement is expected on Sept. 27.
The senior unsecured notes are non-callable and will redeemed at par at maturity.
The proceeds will be used to pay South Africa’s foreign currency commitments and for the general purposes of the government.
The new notes will be listed on the Luxembourg Stock Exchange.
| Issuer: | Republic of South Africa
|
| Amount: | $2.5 billion
|
| Description: | Notes
|
| Bookrunners: | Citigroup Global Markets Inc., Deutsche Bank AG, London Branch/Nedbank Ltd. and HSBC Bank Ltd.
|
| Co-lead manager: | Absa Bank Ltd.
|
| Calls: | Non-callable
|
| Trade date: | Sept. 20
|
| Settlement date: | Sept. 27
|
| Expected ratings: | Moody’s: Baa3
|
| S&P: BB+
|
| Fitch: BB+
|
| Distribution: | SEC registered
|
|
|
| 2027 notes
|
| Amount: | $1 billion
|
| Maturity: | Sept. 27, 2027
|
| Coupon: | 4.85%
|
| Price: | Par
|
| Yield: | 4.85%
|
| Spread: | Treasuries plus 260.5 bps
|
| Price talk: | 4 7/8% to 5%, revised down from initial talk of 5%
|
|
|
| 2047 notes
|
| Amount: | $1.5 billion
|
| Maturity: | Sept. 27, 2047
|
| Coupon: | 5.65%
|
| Price: | Par
|
| Yield: | 5.65%
|
| Spread: | Treasuries plus 283.7 bps
|
| Price talk: | 5¾% to 5 7/8%, revised from 5 7/8% area
|
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