Government Launches Tender Offer to Buy Back $500 Million in Eurobonds

The government has announced a tender offer to repurchase up to $500 Million in outstanding Eurobonds, targeting USD 350M of its USD 1.2B 8.000% notes due 2032 and USD 150M of its USD 371.6M 7.250% notes due 2028, at purchase prices of 105.50% and 103.50% of face value respectively. The offer runs from 18 February to 25 February 2026, with settlement expected on 3 March 2026, and is contingent on the Treasury successfully completing a new US dollar bond issuance to finance the purchase. The Treasury plans to give allocation preference in the new issuance to noteholders who tender their existing bonds, though it reserves the right to modify the maximum purchase amounts and accept tenders on a prorated basis if submissions exceed the targets.

The government aims to smooth out the maturity profile of its external debt, with all purchased notes to be cancelled rather than reissued, representing continued execution of its liability management strategy following earlier buybacks of the 2027 and 2028 Eurobonds. The move seeks to reduce refinancing pressure ahead of the May 2032 maturity for the 8.000% notes and the February 2028 maturity for the 7.250% notes, while the linked new issuance structure allows the government to extend maturities and potentially secure lower borrowing costs. Success depends on market appetite for the new issuance and the pricing achieved relative to secondary market levels on the bonds being retired, with Citigroup Global Markets and Standard Bank of South Africa acting as dealer managers for the transaction.