PNG’s first sovereign bond issue succeeds with top firm’s help

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Papua New Guinea’s (PNG) inaugural sovereign bond issue has succeeded with the help of Dentons.

The global firm, the sole PNG external counsel engaged on the deal, advised Credit Suisse (Singapore) as global coordinator and Citigroup Global Markets as joint lead manager and bookrunner on the country’s notes offering which raised US$500m and closed on 4 October.

The deal followed Dentons advising the PNG government on the US$500m syndicated sovereign loan arranged by Credit Suisse in 2017.

Demand for the bond was “beyond expectations,” Dentons said. Investor presentations were made for the notes in Singapore, Hong Kong, London, New York, Boston, and Los Angeles. The notes were issued pursuant to Rule 144A and Regulation S of the US Securities Act.

The global firm’s team was led by Stephen Massa, partner and PNG head, who was assisted by senior associate Wavie Kendino and associate Theresa Kawi.

Kendino was in Singapore with PNG’s deputy prime minister and treasurer, central bank governor, and treasury secretary for the launch of the offer. She said that it is a “once in a lifetime experience for a young Papua New Guinean excited about her country’s future.”

“PNG has a great story to tell and it is very pleasing that the international financial markets have seen this. It is a milestone for PNG and a good news story for the host country of this year’s APEC Leaders’ Summit,” Massa said.

“A debut sovereign bond by a frontier market is no easy task. Not only does the investment offering need to meet strict credit and risk criteria, the government team appropriately resourced and available to undergo the demanding due diligence and roadshow exercise, but financial markets have to be just right. All this makes for a limited window of opportunity and explains why this transaction has been years in the making,” he said.