On 15 April 2021, Georgia successfully priced a US$ 500mn, 5-year Eurobond. The coupon rate for the bond was determined at 2.750%. The Eurobond was met with significant interest from investors, some of the largest asset managers globally, with orders reaching US$2.0bn. After the book building the yield on the Eurobond was determined at 2.875%, representing c207bps spread over comparable US treasury (UST 0.750% due Mar 2026).
Notably, Georgia tapped international debt markets for the first time since 2011, when a 10-year US$ 500mn, 6.875% Eurobond was issued. The Eurobond matured on 12 April 2021.
The transaction records several milestones for the country, namely:
Securing the financing at the lowest coupon and yield in the history of Georgia;
The lowest yield and coupon achieved by any country from the region (for reference in January 2021 Armenia tapped international debt markets, securing a 10-year, US$ 750mn Eurobond at 3.6% coupon and 3.875% yield at the date of issuance);
Some of the comparable securities – Armenia 25 (B+/Ba3) and Uzbekistan 24 (BB-/B1/BB-) – are trading in the range of 2.5%-4.05% YTM as of 14 April. 5-year interpolated yields on Armenia and Uzbekistan stand at c. 4.26% and 3.15%, respectively, making Georgia’s placement a huge success.
Goldman Sachs International and JP Morgan Securities plc acted as a Joint Global Coordinators and Joint Bookrunners on the transaction along with ICBC Standard Bank Plc (the "Joint Bookrunner") while local investment banks JSC Galt & Taggart and TBC Capital LLC acted as Co-managers.