Benin completes Africa’s first international bond transaction of the year

Benin completes Africa’s first international bond transaction of the year, with the issuance of one billion euros in two tranches with final maturities of 11 years and 31 years.


The Republic of Benin priced on January 12 a new bond issue in euros on the international markets. This transaction, combined with a liability management operation, will enable the early repayment of 65% of the nominal amount of Benin’s 2026 Eurobond (equivalent to 324 million euros), as well as the financing of the 2021 budget and of flagship projects under the Government Action Program. From January 6 to 11, the official delegation of the Republic, led by the Minister of Economy and Finance of the Republic of Benin, Mr. Romuald Wadagni, held bilateral talks with several major international institutional investors. This roadshow was an opportunity for the Minister to present to investors the concrete achievements under the Government Action Program in the context of the Covid-19 crisis.

On January 12, the Ministry of the Economy and Finance successfully raised 1.0 billion euros (656 billion CFA francs) from international investors. Taking advantage of particularly supportive market conditions, Benin raised 700 million euros with final maturity of 11 years, at a coupon of 4.875%, and 300 million euros with final maturity of 31 years, at a coupon of 6.875%. With this newly issued 2052 Eurobond, the longest ever reached by the country, Benin joins the rare emerging market Sovereign issuers to have a euro- denominated Eurobond with a maturity above 30 years. This issuance was coupled with a technical liability management operation as part of the proactive public debt management strategy implemented by the government.

The successful partial repurchase of Benin’s 2026 Eurobond allows the country to limit refinancing risks, extend public debt maturity and reduce the average cost of debt. Benin is the first issuer in Africa to tap the international market this year, following a swift execution process. The transaction orderbooks reached a peak of nearly 3 billion euros during the issue day (i.e. a 300% subscription), including 1.9 billion for the 11-year tranche and 1.2 billion for the 31-year tranche. More than 125 investors placed orders, many of whom had not participated in Benin’s inaugural issue in March 2019. The Republic therefore managed to diversify its financing sources and extend the average maturity of its marketable debt while reducing the average cost of its debt portfolio.

The success of this transaction reflects the interest of international investors in Benin’s credit. The financial closing of the new issue is expected to take place on January 19, 2021 and the financial closing of the repurchase transaction is expected to take place on January 20, 2021.


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