R2.5 bn bonds issue sees Transnet return to capital market

HAVING ISSUED two Aa2.za rated bonds totalling R2.5bn into the local debt market last week, state-owned logistics utility Transnet has reaffirmed its drive to transform itself from a diversified conglomerate into a focused freight transport company. The bonds, rated by U.S. ratings agency Moody’s, are the first issuance under the R30bn mediumterm note programme announced a few months ago and will not be guaranteed by the state. “That we are able to return to domestic capital market without a government guarantee testifies to the strength, efficiency and resilience of our balance sheet,” said Maria Ramos, Transnet Group Chief Executive. The last bond issue by Transnet was in 2 004. As Transnet plans to raise R25bn in both the local and foreign debt market over the medium term, its gearing ratio will remain below 50 percent as its port, rail and pipeline projects unfold.