Paratus Namibia Holdings Limited (Paratus), facilitated by Cirrus Capital, completed a successful auction of N$175 million in floating-rate notes, with the entire issuance fully allocated despite receiving a total demand of N$557 million.
The notes, featuring a five-year tenor and priced against the 3-month JIBAR with a reference rate of 8.342%, attracted significant interest from the market, evidenced by 18 bids received from nine firms.
However, amid competitive conditions, only two bids were successful on 12 June 2024. The auction’s key metrics reveal a bid-to-cover ratio of 3.18x, indicating that bids exceeded the amount offered by over three times.
Of the total bids, only one bid was allocated in full, illustrating the competitive nature of the auction.
“The key metrics of the auction revealed that the total amount offered was N$175 million, with total bids received amounting to N$557 million, resulting in a bid-to-cover ratio of 3.18x,” said Cirrus Corporate Finance Associate Chastin Bassingthwaighte.
This high demand resulted in a clearing spread of 270 basis points and a final interest rate set at 11.042%.
“The allocated amount matched the amount offered at N$175 million, with a clearing spread of 270 basis points,” she said.
Bassingthwaighte noted that financing aims to cover day to day operational expenses of the company.
This comes after Paratus last week successfully raised over N$600 million from its rights issue to expand its offerings by enhancing its core systems and infrastructure.
The raised capital, according to the telecommunications company, has been sourced from a diverse group of investors, including the Paratus Group (61.9%), institutional investors (34%), Paratus employees (2.6%), and retail investors (1.5%).
