LONDON, Feb 27 (IFR) - The United Republic of Tanzania has priced a USD600m seven-year amortising bond at par to yield 600bp over Libor, reaching the maximum amount it had planned to raise through the privately placed floating rate note.
The Reg S notes have an amortising structure and average maturity of five years with final due date March 8, 2020. The principal amortises in nine semi-annual instalments starting on the notes' third anniversary.
The unrated East African sovereign had released initial price guidance of low 600bp over Libor area for the transaction.
Standard Bank was sole lead manager on the deal. (Reporting by Davide Scigliuzzo; Editing by Sudip Roy)
Tanzania tests investor demand for 7-yr amortiser
MILAN, Feb 25 (IFR) - The United Republic of Tanzania is testing investor interest for its upcoming issue of a seven-year amortising bond in the area of 600bp over Libor, according to market sources.
The unrated East African sovereign, which could release official price guidance on the deal as early as Monday afternoon, is targeting a size of USD500m for the floating-rate private placement, the same sources said.
The Reg S notes have an amortising structure and average maturity of five years with final due date in 2020. The principal amortises in nine semi-annual instalments starting on the notes' third anniversary.
A fund manager who covers the region said the deal was offering attractive pricing compared to other B and B-minus rated sovereigns in Sub-Saharan Africa. "They are offering a nice pick-up, which is what you would expect from an unrated issuer," he said.
Tanzania's unlisted, unrated placement is widely seen by the market as an about turn on the sovereign's old plans to issue a plain-vanilla debut Eurobond.
The floating rate format is particularly rare among emerging market borrowers, which usually resort to fixed-rate transactions. The issue, however, could appeal to investors willing to get exposure to the region but wary of the risk of a spike in US Treasuries.
Standard Bank is sole lead on the transaction, which is this week's business. (Reporting by Davide Scigliuzzo; Editing by Sudip Roy)
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