With a series of amendments to the terms of the programme
Government has extended the expiration date of its domestic debt exchange programme to January 16, 2023, the Finance Ministry announced.
This is the second time the government is extending the expiration date of the programme which was launched on December 5, 2022, as part of effort to address the country’s ongoing economic crisis.
Under the programme, the government invited certain holders of approximately GH¢137.3 billion of principal amount outstanding of “our certain domestic notes and bonds issued by the Government, E.S.L.A. Plc or Daakye Trust Plc (the “Eligible Bonds”) are expected to exchange their Eligible Bonds for a package of new bonds to be issued by the Government (the “New Bonds”).
Announcing the extension of the expiration date of the invitation from Friday, December 30, 2022 at 4 pm to Monday, January 16, 2023 at the same time in a press release, THE PUBLIC RELATIONS UNIT MINISTRY OF FINANCE said: “The Settlement Date for the Invitation is now expected to occur on Tuesday, 24th January 2023, or as soon as practicable thereafter, but no later than the Longstop Date which is now scheduled for Tuesday, 31st January 2023, unless further extended by the Government pursuant to the Invitation. The Announcement Date is now expected to occur on or about 17th January 2023.”
In addition to the foregoing extensions, the government announced the following modifications to the Invitation to Exchange, and they are; offering accrued and unpaid interest on Eligible Bonds, and a cash tender fee payment to holders of Eligible Bonds maturing in 2023; Increasing the New Bonds offered by adding eight new instruments to the composition of the New Bonds, for a total of 12 New Bonds, one maturing each year starting January 2027 and ending January 2038; Modifying the Exchange Consideration Ratios for each New Bond. The Exchange Consideration Ratio applicable to Eligible Bonds maturing in 2023 will be different than for other Eligible Bonds; Setting a non-binding target minimum level of overall participation of 80% of aggregate principal amount outstanding of Eligible Bonds; and Expanding the type of investors that can participate in the Exchange to now include Individual Investors.
“These modifications will be set forth fully in an Amended and Restated Exchange Memorandum which is expected to be published during the week of 26th December 2022,” the Ministry said: “Conforming changes (including adding and modifying defined terms) in respect of the above amendments and modifications to cure ambiguity, omission, defect, error or inconsistency may be included in the Amended and Restated Exchange Memorandum,” it added.
In making this decision to extend and the modifications described herein, the Government said it considered feedback from the financial sector in relation to the need to secure internal approvals and that the extension affords the Government of Ghana the opportunity to consider suggestions made by all stakeholders with the aim of adjusting certain measures acceptable within the constraints of the Government’s Debt Sustainability Analysis.
“And, as set forth in the Exchange Memorandum, the Government reserves the right in its sole discretion to extend the timetable for the Invitation at any time and to make amendments to the Invitation at any time. Any Eligible Holders whose Eligible Bonds are held on its behalf by a broker, dealer, bank, custodian, trust company or other nominee must contact such entity if it wishes to participate in the Invitation, as such entities may establish an earlier deadline to receive instructions to tender Eligible Bonds,” the Ministry said.