The City of Cape Town may return to the bond market after a six-year absence as it raises money to fund infrastructure projects.
The city plans to raise as much as R2.2 billion ($140 million) in the 2016/17 fiscal year and another R3 billion over the next two years, deputy mayor Ian Neilson said in an e-mailed response to questions.
“The city will be looking at either the loan or bond market, or a combination thereof, depending on market conditions,” Neilson said. It would raise debt with 15-year maturities, he said.
Cape Town last sold debt in 2010, when it issued R2 billion of 15-year securities with a coupon of 11.16%. The city’s net debt fell to 17% of operating revenue in 2015, from 21% the previous year, according to Moody’s Investors Service, which rates the bonds A1.za.
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