MTC share sale to finance debt OGONE TLHAGEWINDHOEK
Government is aiming to raise N$3 billion by selling shares in MTC in efforts to pay debt close to maturity, economic advisor to the President, James Mynupe, said recently.
He made the remarks during the launch of the second phase of President Hage Geingob’s Harambee Prosperity Plan.
“Some of the key uses obviously is to retire some expensive debt [and] to potentially restructure our debt maturity profile as well. You don’t want to put pressure on government to repay debt that is retiring very quickly,” he said.
Mynupe also raised the possibility that government would use some of the proceeds to fund a yet-to-be-established sovereign wealth fund.
“We will also have deep deliberations about whether some of that money can be used to fund a sovereign wealth fund or potentially to fund the capital preparation fund.”
A series of discussions would be held to discuss how best to use the funds, he added.
‘Rigorous analysis’
“All of these discussions would be subjected to rigorous analysis to minimise our cost of capital or to maximise the rate of potential returns,” Mynupe said.
The listing of MTC on the Namibia Stock Exchange (NSX) is being earmarked for the fourth quarter of the year. The policy and attendant strategy are expected to be completed during the second quarter of the 2021/22 financial year.
Namibia’s US$500 million (N$7.3 billion) Eurobond matures this year.
The country’s debt for the 2021/22 financial year N$126.5 billion. Over the Medium-Term Expenditure Framework, the total debt is expected to climb to N$158.8 billion.
Government has not specified how much it plans to list on the NSX.