The first tranche comprises 3.5-year sukuk worth $700 million, carrying a yield of 6.375% and maturing in 2029. The second tranche is a seven-year sukuk valued at $800 million, with a yield of 7.950% and a 2032 maturity.
This structure results in an average funding cost of 7.2%
for an average maturity of 5.25 years. This cost is lower than the current
prevailing yield of 7.5% on Egypt's five-year Eurobonds in the secondary
market.
The ministry noted that the 3.5-year tranche was priced at a
spread 20 basis points below the yield on comparable Egyptian bonds in the
secondary market, while the seven-year tranche was priced 35 basis points
tighter than its sovereign bond equivalent.
The Finance Ministry affirmed it is proceeding with its strategy to improve government debt metrics. This strategy focuses on diversifying financing sources and instruments and broadening the investor base to help reduce funding costs and extend the average life of the debt, while maintaining continuous efforts to sustainably lower external debt annually.