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11 March 2010
Standard Bank Group (SBG) has raised US$2bn in a landmark deal for the National Treasury of South Africa.
SBG and Deutsche Bank were the joint lead managers, with Nedbank co-lead on the largest global bond issued to date by the Republic of South Africa: a US$2bn 10-year transaction that attracted an extraordinary high level of investor demand.
The deal represented a premium of only 12 bps to the interpolated curve of South Africa's outstanding US$ bonds.
SBG was able to allocate the transaction to a broad and diverse group of institutional investors across the globe, with US investors buying 60% of the offering, UK investors 23%, European investors 10% and Asian investors 4%. Fund Managers bought 71%, hedge funds 9%, banks 6% and insurance companies 5%.
Kennedy Bungane, SBG's Chief Executive, Corporate and Investment Banking in South Africa, says: "Standard Bank is delighted to be a joint lead book runner in this landmark transaction. This comes at a time that is particularly significant for South Africa, with the hosting of the FIFA World Cup and the escalation of infrastructure expenditure rollout. The size, price and broad-base investor subscription of this issue shows remarkable international confidence in the South African story."
Florian von Hartig, Head of Global Debt Capital Markets at SBG, adds: "The success came on the back of a very strong order book with over 75% allocated to buy and hold institutional investors across a broad geographic spread.
"By actively engaging key investors and generating the desired momentum, the Joint Lead Managers were able to close the book in less than 48 hours and ensure that the ideal 10 year term for the National Treasury of South Africa was achieved at economically attractive terms."
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