IDBZ raises $45m

Oliver Kazunga, Senior Business Reporter
THE Infrastructure Development Bank of Zimbabwe (IDBZ) has raised $45 million of the $50 million energy bond that was issued in 2014 to fund two power generation projects.

The refurbishment of Kariba South Power Station ($38,8 million) and repowering of Harare Thermal Power Station ($11,2 million) are the two projects that the IDBZ bond seeks to fund.

In a statement, IDBZ said the refurbishment project on Kariba South is critical for ensuring stable generation capacity in support of the 300 megawatts expansion programme presently under implementation by EPC Contractor.

It said the Harare Thermal Power Station repowering project is awaiting finalisation of the full project financing arrangements with $11,2 million being raised going towards the Zimbabwe Power Company’s funding contribution.

“To date, the bank has raised $45 million under the IDB series two 2014B Bond with headroom of $5 million still available for subscription. The Zimbabwe Power Company bond is a five-year instrument, carries a fixed coupon of nine percent per annum and has semi-annual interest and capital payments,” it said.

Since its floatation, the bond has had three coupon and principal payments, which were settled timeously per the instrument’s repayment schedule in June and December last year and last month.

IDBZ launched the first tranche of energy bonds in 2012 worth $30 million to finance the prepaid metering project by the Zimbabwe Electricity Transmission and Distribution Company (ZETDC), which was fully subscribed.

The prepaid metering project has helped ZETDC, the distribution subsidiary of Zesa Holdings to boost revenue collection and enhance its creditworthiness.

In November 2014, IDBZ also issued a five-year medium term note worth $15 million, which was fully subscribed to fund the ZETDC metering programme.

IDBZ said since the floatation of the $15 million bond, the note performed according to payment terms with coupon and capital payments being effected on schedule last year in June and December as well as June this year.

“The next coupon and principal payment date is December 7, 2016,” it said.

Last December, the bank successfully issued its maiden housing bond for $5 million through private placement.

“The instrument is fully subscribed, has a five-year tenor and carries a fixed coupon of 9,5 percent per annum. The proceeds of the bond are financing the development of two housing projects, namely New Marimba Park (Harare) and Clipsham Views (Masvingo), where site servicing is currently in progress,” said IDBZ.

The two projects are expected to deliver 1 042 serviced residential stands.