Absa raises R128m bond issue for Simmers

[miningmx.com] — Absa Capital, the investment banking division of Absa Bank (ASA), acting as sole lead arranger, has raised R128m in a high yield, unrated bond issuance for Simmer & Jack Mines.

The bonds are the first high yield bonds to be listed on the Johannesburg Stock Exchange.

This is the second high yield bond executed by Absa Capital in the last six months following the private placement of the Savcio Holdings high yield corporate bond issuance and marks the early signs of a possible resurgence of the high yield bond market in South Africa.

Prasanna Nana, Head of the South African Debt Capital Markets team at Absa Capital, said: “The debt capital market in South Africa is increasingly becoming an important source of liquidity for a wider range of issuers in South Africa. We are pleased to have partnered with Simmer & Jack on their debut in the debt capital market.”

The bond was executed under a Domestic Medium Term Note (DMTN) programme that was established by Simmer & Jack.

“The deal was concluded in just four weeks, including establishing the DMTN, demonstrating that corporates can raise funding in the capital markets over a short period of time,” said Nana.

“We expect similar types of issuances to come to market as corporates continue to diversify their funding sources away from traditional bank lines and as the high yield market further develops in South Africa,” added Nana.