bond issuance

8/8/2019 Bond Issuance

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PROCESS OF BONDPROCESS OF BOND

ISSUANCEISSUANCE

PRESENTATION BYPRESENTATION BY

MOHAMED HASSANMOHAMED HASSAN

EXECUTIVE DIRECTOREXECUTIVE DIRECTORDYER AND BLAIR INVESTMENT BANK LIMITEDDYER AND BLAIR INVESTMENT BANK LIMITED


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PREPRE--ISSUE PREPARATIONISSUE PREPARATION

Consult your Investment BankerConsult your Investment Banker

Business plan discussionsBusiness plan discussions

Financing requiredFinancing required

Capital structure decisionsCapital structure decisions

Debt optionDebt option


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PREPARATION OF WORKPLANPREPARATION OF WORKPLAN

AND TIMETABLE OF ISSUEAND TIMETABLE OF ISSUEBOND ISSUE TIMETABLE 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Mandate LetterFinalise Mandate Letter

Information MemorandumFinalise Draft I.M.for submission to CMA and NSE

Address any regulatory comments

Legal Documentation

Legal Due Diligence, Documentation/ Legal opinion

drafting for inclusion in I.M. (including conversion to

public company & finalisation of security documents)Finalise Agency Agreements

Financial

Financial Due Diligence, Draft Report for inclusion in IM

Regulatory ApprovalObtain approval for the Issue from CMA and NSE

Obtain approval from Govt

Marketing and Book BuildingInitial Market-read on key investors; continued dialogue

Appoint sponsoring stockbroker

Prepare research note and indicative terms

Evaluation of market read; prepare term sheet

Fedback on indicative term sheet

Continued dialogue with investors pending I.M. approval

Distribute Investor Pack; Road Shows

Book Building

Price BondsSigning; Settlement

Receipt of bond proceeds

Listing


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APPOINTMENT OFAPPOINTMENT OF

PROFESSIONALSPROFESSIONALS

ArrangersArrangers Investment BanksInvestment Banks Sponsoring Stock BrokersSponsoring Stock Brokers

Reporting AccountantsReporting Accountants Legal counselLegal counsel

Fiscal Agent and RegistrarFiscal Agent and Registrar Note trustees in case of guaranteeNote trustees in case of guarantee


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PREPARATION OF INFORMATIONPREPARATION OF INFORMATION

MEMORANDUMMEMORANDUM

Adhere to legal requirements of Capital Markets Authority ActAdhere to legal requirements of Capital Markets Authority Act

Adhere NSE Rules and RegulationsAdhere NSE Rules and Regulations Opinion by Reporting AccountantOpinion by Reporting Accountant

Certification the projection by the Reporting AccountantCertification the projection by the Reporting Accountant

Legal opinion on authenticity of all documentationsLegal opinion on authenticity of all documentations

Legal opinion on the Information MemorandumLegal opinion on the Information Memorandum Summary of the Bond issueSummary of the Bond issue

Use of ProceedsUse of Proceeds

Key investment considerationsKey investment considerations

Financial rating or healthFinancial rating or health

Industry analysisIndustry analysis

Issues of Corporate GovernanceIssues of Corporate Governance

Experience and qualification of Board of Directors and ManagemenExperience and qualification of Board of Directors and Managementt


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MARKETING AND BOOK BUILDINGMARKETING AND BOOK BUILDING

Timing the MarketTiming the Market

Preparation of research note and indicative term sheetPreparation of research note and indicative term sheet

Initial market read on key investorInitial market read on key investor -- To gauge their appropriate appetite and structure forTo gauge their appropriate appetite and structure for

the bondthe bond

Feedback on indicative termFeedback on indicative term Evaluation of market read and preparation of final term sheetEvaluation of market read and preparation of final term sheet

One on One Investor visits to build commitmentsOne on One Investor visits to build commitments


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Address any

regulatory comments

Finalise Draft I.M.for

submission to CMA

and NSE

Information

Memorandum

Financial Due

Diligence, Draft Report

for inclusion in IM

Financial

Obtain approval

from Govt

Obtain approval for

the Issue from CMA

and NSE

Regulatory

Approval

Finalise Mandate

Letter

Mandate Letter

Listing

Signing; Settlement

Price Bonds

Book Building

Distribute Investor Pack; Road Shows

Continued dialogue with investors pending I.M.

approval

Feedback on indicative term sheet

Evaluation of market read; prepare term sheet

Prepare research note and indicative terms

Initial Market-read on key investors; continued

dialogue

Marketing and Book Building

Finalise Agency Agreements

Legal Due Diligence, Documentation/

Legal opinion drafting for inclusion in I.M.

(including conversion to public company

& finalisation of security documents)

Legal Documentation

++

+ +

Review


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AFTER APPROVAL?AFTER APPROVAL?

10 days of offer period10 days of offer period Formal investor group presentationFormal investor group presentation

One on one road show to get commitmentsOne on one road show to get commitments Closure of offerClosure of offer

Announcement of allocationAnnouncement of allocation Settlement on the value dateSettlement on the value date

ListingListing


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Corporate Bond MarketCorporate Bond Market

UnsecuredUnsecuredTB+1.75%TB+1.75%20102010ARM (800m)ARM (800m)

75% enhanced75% enhancedTB+1.25%TB+1.25%20092009CeltelCeltel (4.5b)(4.5b)

UnsecuredUnsecuredFixed at 7.5%Fixed at 7.5%20072007EADB (750m)EADB (750m)

75% enhanced75% enhancedTB+0.5%TB+0.5%20102010Faulu KenyaFaulu Kenya

(500m)(500m)

UnsecuredUnsecuredTB+1%TB+1%20122012PTA Bank (800m)PTA Bank (800m)

75% enhanced75% enhancedTB+1%TB+1%20062006Safaricom (4bn)Safaricom (4bn)

UnsecuredUnsecuredTB+0.75%TB+0.75%20062006EADB (2bn)EADB (2bn)

75% enhanced75% enhancedTB+1.25%TB+1.25%20072007Mabati Rolling MillsMabati Rolling Mills

(1bn)(1bn)

Unsecured/SecUnsecured/Sec

ureduredPricingPricingMaturityMaturityIssuerIssuer


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Case for TTF BondCase for TTF Bond

The Tourist Industry has contributedThe Tourist Industry has contributedsignificantly to the economic revivalsignificantly to the economic revival

Capacity constraints in the majorCapacity constraints in the major

attraction areas could hinder futureattraction areas could hinder future

growthgrowth

New strategies, more local players andNew strategies, more local players andinnovative funding is requiredinnovative funding is required


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Q&AQ&A

THANK YOU.THANK YOU.

bond issuance

Documents