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15 September 2016

Atta Africa Financial Update

Key commercial and political activity in Africa for private equity investors by DCE Partners, UK Private Equity advisors to Atta.

Executive summary: A month after scrapping a planned bond issuance due to high prices, Ghana has returned to international financial markets with the issuance of a US$750 million bond, yielding 9.25% with a maturity extending to 2022. The bond was aimed at investors bearish on the possibility of a Fed hike and looking for coupon paying debt securities.

Despite concerns about run-away fiscal expenditure before approaching parliamentary and presidential elections, the West African country’s bond was five times over-subscribed. Although the IMF programme has helped stabilise the cedi, Ghana is unlikely to call on the Washington lender’s last tranche of funding having now secured alternative financing.

Bond proceeds will be used to refinance debt maturing in 2017 with the balance being used for capital projects.

Fact: North Korea owes Sweden €300 million for 1,000 stolen Volvos. Sweden periodically sends Dear Leader reminders of the outstanding debt.

Qalaa Holdings looking to exit 85% stake in Rift Valley Railways

 
  • Given that TransCentury sold its 34 per cent in RVR to Qalaa for US$43.7 million in 2014 and Centum sold its 10 per cent stake in 2010 for US$4.5 million, RVR could now be priced nearer to US$250 million
  • Competition from the operator chosen to run the standard gauge railway, speculated to be eventually from China, is a factor for any buyer to consider

DPI to invest US$100 million in Atlantic Business International
 
  • Atlantic Business International is the financial services partnership established in 2012 between West Africa’s Atlantic Financial Group and Morocco’s Banque Centrale Populaire