Rabat – Morocco’s state-owned phosphate and fertilizer group OCP has announced carrying out a bond issue worth $1.5 billion.
The bond consists of two instalments of maturities of 10 and 30 years, with respective coupons of 3.750% and 5.125%.
The EURONEXT Dublin listed the bonds, which are rated BB +/stable by Fitch Ratings and BB+ /stable by Standard & Poors.
BB assessments indicate “an elevated vulnerability to default risk,” according to Fitch Ratings.
The group described the issuance of the bond as success, saying that the project reflects the “quality of the OCP group’s signature with international investors.”
OCP CEO Mostafa Terrab said that the objective of the proactive approach by the group is to “optimize” its financial structure by “taking advantage of changing market conditions.”
The group emphasized that the transaction was a “resounding success illustrated by several indicators, with a subscription of more than 4.7 times for a total of approximately $7 billion for the two tranches.”
In its statement, OCP explained that the issuance is “also confirmed by a negative new issue premium of -10 basis points for the two tranches and the lowest rates achieved by the Group on these maturities and the largest order book in Africa, all sectors combined, this year as well as the largest 13-year tranche ever achieved by an industry company in the MENA region.”
The company added that the bonds have been placed with qualified institutional investors, fund managers, banks and private banks in several countries, including Morocco, the US, UK, as well as more widely in Europe, the Middle East, and Asia.
OCP finished the first quarter of 2021 with a 16% turnover increase compared to the same period last year.
The group announced that its turnover amounted to nearly $1.61 billion.
The company attributed the increase in its turnover to production optimization, cost reduction, and favorable market conditions.
OCP’s investment expenditures reached MAD 1.75 billion ($198.72 million) for the first three months in 2021, against MAD 2.125 billion ($241.3 million) during the same period last year.
