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MTN Group today announces the early settlement of US$300 million of eurobonds with a 2024 maturity date, significantly deleveraging the balance sheet following strong first-half 2022 performance.
On a pro forma basis for H1 2022, this reduces MTN’s dollar-denominated debt to 35% of the holding company’s (Holdco) total debt.
MTN encouraged qualified holders of the US$750 million eurobond, which matures in November 2024, to submit their notes for the company to buy for cash by the end of August.
Over US$482 million worth of bids were submitted in response to the offer.
This was a huge increase over the anticipated early settlement budget of $250 million USD.
MTN increased the ultimate acceptance amount as a result, and it will now be resolved on Tuesday, September 6, 2022, for US$300 million.
“In line with our Ambition 2025 strategy, we are committed to deleveraging the balance sheet faster in line with our capital allocation framework,” said MTN Group President and Chief Executive Officer Ralph Mupita. “This week’s early settlement supports delivery of this commitment as well as of the execution and delivery of our medium-term guidance to maintain the Holdco leverage below 1.5x.”
The settlement would be paid for out of available cash balances, according to MTN Group Chief Financial Officer Tsholofelo Molefe, thus it wouldn’t change the pro-forma Holdco leverage of 0.8x by the end of 2022.
On a pro-forma basis, the settlement raises the ratio of non-rand debt to rand debt at the end of June 2022 from the 42:58 ratio disclosed in the Group’s intermediate results to 35:65.
The Holdco leverage was 1.0x at the end of December 2021.
The return of R9.4 billion in cash from our operational companies helped the first half of 2022’s improvement to 0.8x (including R4.5 billion from MTN Nigeria).
Source: Ghanatodayonline.com
