Gabon announced on Wednesday, October 14, an international bond issue of 580 million dollars, maturing in 2034 and carrying an annual coupon of 9.375%, according to a government statement.
With capital unchanged, this coupon represents 54.375 million dollars in interest per year, calculated on the announced amount. The order book reached nearly one billion dollars, according to the authorities, or about 1.7 times the amount issued.
The country is borrowing this time for eight years, compared with seven years for the operation announced on July 30. That one covered 920 million dollars, with maturity in 2033 and the same coupon of 9.375%. The two issues thus total 1.5 billion dollars.
The ministry says the risk premium of the new bond is about 50 basis points lower than that of July. This premium measures the spread over the market benchmark rate. Its decline can therefore coexist with an unchanged coupon when that benchmark rate rises.
The authorities present the operation as a way to lengthen debt maturities and diversify funding sources. They specify that it is the first Gabonese issue under a public offering format since 2021.
For the July bond, the General Debt Directorate had announced that the proceeds would be used for projects of the National Growth and Development Plan 2026-2030 and for settling arrears. That previous bond benefits from a three-year amortization deferral.