ESLA issues 10-year Cedi bond following buy-back
E.S.L.A. Plc, on Thursday, June 27, 2019, issued to the public 10-year cedi denominated bonds, the latest issuance under the GHc 10 billion programme.
This follows an earlier buy-back arrangement by the company during the same week, for portions of the bonds issued under the GHc 10 billion programme from the holders of the 2024 and 2027 bonds.
The new bond issuance was aimed to raise a minimum amount of GHc 300 million and a maximum of GHc 1 billion, with maturity on Friday, June 15, 2029. This issuance represents Tranche E3 Bonds under the bond programme.
Proceeds from the new 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.
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, amounted to a total of GHc 664.720 million in bond buybacks which have subsequently have effectively been written off.
This leaves an outstanding balance of GHc 2.260 billion and GHc 2.740 billion bonds on the E.S.L.A. Plc 2024 and 2027 bonds respectively with total outstanding bonds at GHc 5 billion.
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.
Issuance of the new, up to GHc 1 billion under the Tranche E3 Bonds will result in total outstanding bonds of GHS 6 billion in accordance with the conditions set under the GHS 10 billion bond programme.
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 amounts 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 as well as increased pace of direly needed power generation and transmission infrastructure as well as improved road maintenance.