Ecobank Transnational Incorporated (ETI) Plc-the pan-African parent company of Ecobank Group, has signed a five-year $250 million senior unsecured loan facility from Deutsche Bank AG.
The Public Investment Company (PIC) of South Africa, one of the major institutional shareholders of ETI, is providing full credit support to Deutsche Bank on the transaction through a sub–participation of risk.
In a statement yesterday, ETI stated that the new facility of $250 million, equivalent to N76.5 billion, will be used primarily to refinance maturing facilities.
Shareholders of ETI had recently authorised the board of the financial services group to raise up to $400 million through a convertible bond issue. At the annual general meeting and extraordinary general meeting held in Lomé, Togo, shareholders voted in support of the convertible bond issue, which will be undertaken by way of rights issue. As a rights issue, the units will be pre-allotted to shareholders on the basis of their existing shareholdings. As a convertible bond, it means shareholders can exchange the bond unit for other instrument or cash.
Ecobank had confirmed to The Nation that the convertible bond issue will include equities option that allows unit holders to convert their bonds to equities in a middle-of-the-road debt-to-equity financial structure that has become a regular feature of the pan-African group.
ETI, which is also listed on the Ghana Stock Exchange in Accra and the West Africa Stock Exchange (BRVM) in Abidjan, will use the net proceeds of the $400 million bond issue to repay the bridging finance required to create a resolution vehicle to manage Ecobank’s legacy loan portfolio and to optimise the maturities of the group’s debt portfolio.