HAMILTON – The Bermuda Government has raised US$500 million in a public bond offering that was six times oversubscribed. Government will pay a fixed interest rate of 5.6 per cent on the ten-year bonds, or a total of US$28 million a year. Originally, the intention wasto raise US$400 million, but financial secretary Donald Scott revealed that the strong global demand, which generated an order book of US$2.4 billion, had enabled Government to upsizethe transaction to $500 million.
Scott added that the debt sale had attracted 146 investors, ten per cent from Bermuda. The others were from North America (60 per cent), Europe (20 per cent), and Asia and the Middle East (ten per cent). The government is saddled with a debt burden that has soared in recent years and total debt outstanding was US$826 million as at March 31. The proceeds of the bond sale will be used to repay a bridge loan covering a revolving credit facility, short-term indebtedness with local banks of around US$140 million, and to fund ongoing capital expenditure programmes. Finance Minister Paula Cox was said to be overseas and unavailable for comment. The sale was managed by HSBC and followed a “non-deal roadshow” designed to drum up global investor interest in the bonds.
(Bermuda Royal Gazette)
