The South African National Roads Agency Limited (Sanral) reported on Thursday that it received bids totalling R1,28-billion during its third bond auction of 2009, which would be settled on May 18.

The auction tapped into three of the agency’s six bonds maturing in 2013, 2018, 2022, 2023 and 2028.

Market spreads of 1,7% to 1,8% over the RSA Government benchmarks where achieved, which were 5 to 10 basis points “tighter than where the bonds were marked”.

The latest issue meant that Sanral had now raised R9,95-billion of the funding it required for its R25-billion expansion and upgrade of toll roads, including the R20-billion Gauteng Freeway Improvement Project, which would be completed by late 2010.

Absa Capital and Rand Merchant Bank were the joint lead arrangers on the agency’s Bond Exchange of South Africa-listed Domestic Medium-Term Note Programme (DMTNP).

Sanral planned to raise another R12-billion by the end of March 2010, and was also planning a retail bond offer, which would be the first to be listed on the Yield-X, probably within the next three months.

Some R50-million could be raised through its so-called ‘HWAY’ (pronounced ‘highway) bond, which would offer a return of Johannesburg Interbank Agreed Rate plus 45%.

But, by far the bulk of the capital would be raised through a DMTNP, through which the first money was secured on July 10 last year.

PUBLICATION: Engineering News
AUTHOR: Terence Creamer
DATED: 14th May 2009