Accra, Ghana//-PETROSOL Platinum Energy PLC, a leading ISO-certified indigenous oil marketing company (OMC), today became the first OMC to list a corporate bond on the Ghana Fixed Income Market (GFIM), the secondary market of the Ghana Stock Exchange (GSE).
Investors showed historic confidence in the company as its maiden GHS 100 million corporate bond received 178% subscription, senior officials said at the listing ceremony in Accra.
PETROSOL listed its Series 1 and Series 2 Notes on the GFIM of the GSE, marking the maiden issuance under its GHS 200,000,000 Note Issuance Programme recently approved by the Securities and Exchange Commission (SEC) and the GSE.
The listing follows a bookbuild that closed 178% subscribed, with combined bids of GHS 178,074,000 against a GHS 100,000,000 target, a result the company and its advisers describe as a clear signal of institutional investor confidence in PETROSOL’s credibility and growth plans.
The four-year Tranche 01 alone attracted GHS 114,277,000 in bids against its GHS 50,000,000 target, representing a 229% subscription from 66 underlying investor clients while the five-year Tranche 02 drew GHS 63,797,000 in bids against its GHS 50,000,000 target, representing 128% subscription from 18 underlying investor clients.
Demand outstripping supply on both tranches is a rare outcome in Ghana’s still-developing corporate bond secondary market, and underscores investors’ confidence that PETROSOL represents a well-governed, well-managed and well-structured credit story.
PETROSOL plans to return to the market later to raise the remaining GHS 100 million, in line with the implementation schedule of its strategic plan.
Purposes of capital raised
The CEO of PETROSOL Platinum Energy PLC, Michael Bozumbil, told participants at the ceremony that funds raised would be directed toward improving the company’s working capital to shift the company’s fuel procurement from credit purchases to cash purchases to reduce cost of sales, improve margins and also offer greater value to consumers.
He explained that in line with the company’s strategic plan, over the next five years, the funds PETROSOL had raised and would be raising from the capital market would be deployed to:
- Increase their working capital to enhance fuel procurement efficiency to deliver more value to the consumer and improve profitability.
- Increase their Retail Sales volume by investing to enhance the quality and sales performance of existing stations and also building new stations in major towns and cities to become more accessible to consumers.
- Expand their Business-to-Business portfolio by increasing their volume of supply to bulk corporate consumers of petroleum products.
- Expand their Fuel Haulage Business by increasing the number of fuel tankers to enhance supply chain efficiency, fuel quality management and generate additional revenue for the company.
- Expand their Lubricants Business to make our high-quality lubricant products dominant in Ghana and West Africa to meet growing demand for our products and thus increase revenue.
- Invest more in renewable energy solutions, including powering all our stations with solar energy to reduce cost of operations and also install Electric Vehicles (EV) charging points at some of our stations to meet emerging demand and promote green and sustainable business operations.
Mr Bopzumbil therefore assured all that the future is bright for PETROSOL and their investors as well as their other stakeholders.
The Board Chairman, PETROSOL Platinum Energy PLC, Daniel Acheampong, noted: “The oversubscription on both tranches tells us investors of the Ghana Stock Exchange recognise that work. We are proud to bring PETROSOL to the Ghana Fixed Income Market of the Ghana Stock Exchange on the strength of that credibility, and the Board will hold management to the same discipline in ensuring these proceeds are applied exactly as promised to our investors.”
Committed to play by the rules
It is against this backdrop that we in PETROSOL have committed to play by the rules of the industry, keep pace with daily energy demands with exceptional agility, robust supply chains, and structured financing without compromising Environmental, Social and Governance stewardship, according to him.
“To our institutional investors and all stakeholders connected with this significant milestone, we wish to assure you that we recognise the gravity of your trust reposed in our company.
Particularly for you investors, we know you seek sustainability, transparency, and timely returns. You can trust the Board of Directors to exercise the highest levels of its fiduciary responsibilities in this regard”.
Mr Acheampong pledged to uphold absolute financial discipline and to be guided by strict adherence to the SEC regulations and their Fiduciary duties as a board, assuring that every cedi raised is efficiently deployed to generate optimal economic value and fulfil their coupon and principal payment commitments on time, without fail.
In her welcome address, the Managing Director of the Ghana Stock Exchange, Madam Abena Amoah, urged businesses in the country and beyond to come to the local bourse to raise cheap and patient capital to grow and expand their operations
