Barclays Capital and Goldman Sachs International were joint lead managers. The cost of funding the bond will not significantly impact the overall cost of debt for the company, as it was priced at 4.50% coupon, an 80 basis points above the South African government's international cost of debt.
Chairman Mafika Mkwanazi says, "We have now achieved another funding objective of diversifying our funding sources in a cost effective manner, by emphasising our commitment to raise funds when opportunity arises, ahead of requirements. It is even more encouraging that we are able to raise funds at these rates in international debt capital markets without any government guarantees but on the strength of the Transnet balance sheet."
Transnet requires R41 billion in funding for the next five years, of which in excess of R22 billion has now been raised through a variety of sources including export credit agencies, domestic and international bonds, bank loans and development financial institutions. The proceeds are used primarily to finance the company's rolling five-year R93.4 billion capital investment programme which is focused on rejuvenating and modernising its rail, port and pipelines logistics infrastructure.
