Following the recent passing of a parliament law giving Egypt the green light to issue dollar-denominated eurobonds, the government made a $1.5 billion eurobond issue on Friday, June 29, according to AFP news agency.
The eurobonds are comprised of $500 million five-year bonds carrying an interest rate of 7.6 percent, and the remaining $1 billion are to mature in 10 years with an interest rate of 8.7 percent.
Morgan Stanley and Merrill Lynch have been chosen to promote the eurobonds on stock markets in the US, the Middle East and Asia.
The new issue is aimed at boosting investments, increasing liquidity and easing the shortage of US dollars in Egypt. The country has been experiencing an economic recession for over two years, in addition to a sharp fall in foreign investments leading to a lack of foreign currency.
According to the new law passed on June 7 by the Egyptian parliament, the government can issue an additional $500 million worth of eurononds, amounting to a total of $2 billion permitted by the law. Maturities of the bonds can be between five and 30 years. — (MENA Report)
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