Nana Akomea says the term for individual bondholders as far as the domestic exchange programme is concerned is too harsh
The government has further extended the deadline to register for its domestic debt exchange to January 16, 2023, in order to secure internal approvals from the financial sector, the Finance Ministry said in a statement late on Saturday.
The ministry also announced a change to the debt exchange, with eight additional instruments to be created.
Ghana’s government, in a bid to mitigate an economic crisis, has negotiated a staff-level agreement for a $3 billion loan package from the International Monetary Fund. The IMF has said that its board will approve the deal only if Ghana undergoes comprehensive debt restructuring.
3. In addition to the foregoing extensions, the Government announces the following modifications to the Invitation to Exchange, which are set forth in further detail on the Term Sheet attached as Annex A to this press release:
i. Offering accrued and unpaid interest on Eligible Bonds, and a cash tender fee payment to holders of Eligible Bonds maturing in 2023;
ii. 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;
iii. 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;
iv. Setting a non-binding target minimum level of overall participation of 80% of aggregate principal amount outstanding of Eligible Bonds; and
v. Expanding the type of investors that can participate in the Exchange to now include Individual Investors.
4. 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. 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.
5. 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.
6. In making this decision to extend and the modifications described herein, the Government considered feedback from the financial sector in relation to the need to secure internal approvals. Further, this 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.
