Egypt sells $3.75B in dollar-denominated Eurobonds

Egypt sells $3.75B in dollar-denominated Eurobonds

CAIRO – 9 February 2021: Egypt sold dollar-denominated Eurobonds on Monday in three tranches worth $ 3.75 billion to finance part of the budget deficit, according to Reuters.

 

Documents from one of the banks arranging the deal showed that Egypt, after receiving requests for about $ 15 billion, sold five-year bonds worth $ 750 million with a yield of 3.875 percent and 10-year bonds worth $ 1.5 billion with a yield of 5.875 percent and 40-year bonds worth $ 1.5 billion, with a return of 7.5 percent.

 

Egypt has resorted to the international debt markets as it seeks to overcome the coronavirus crisis that has caused the collapse of tourism, which is a major source of hard currency.

 

The pandemic has also led to a sharp drop in foreign direct investment and a decline in domestic economic activity.

 

The initial benchmark rate was 4.25 percent to 4.375 percent for the five-year bond tranche, about 6.25 percent for the 10-year bond, and about 7.875 percent for the 40-year bond.

 

Citi, First Abu Dhabi Bank, Goldman Sachs International, HSBC, JP Morgan and Standard Chartered are arranging the deal.

 

Egypt received $ 2.77 billion in emergency financing from the International Monetary Fund in May