The Israeli Government raised $1.6 billion on September 17, 2003, with the guarantee of the United States Government. Minister of Finance Benjamin Netanyahu congratulated the successful offering and stated that it was a vote of confidence in the Israeli economy on the part of the United States administration.
The offering was led by Deputy Accountant General Eldad Fresher, and it was conducted by way of a tender between 14 investment houses that were pre-qualified as bidders and that competed over the lowest return.
The offering consists of two bonds. The first has a total volume of $450 million for 30 years, while the second is for $1.15 million for 20 years.
The 30-year offering in the amount of $450 million was secured by Barclays Capital, at an overall return of 5.579 percent, reflecting a margin of 38 base points over corresponding US Government bonds.
The 20-year offering in the amount of $1,150 million was secured by Merrill Lynch, at an overall return of 5.52 percent, reflecting a margin of 33 base points over corresponding US Government bonds.
Contrary to previous offerings that were conducted by the Israeli Government between the years 1988-1992 with US guarantees, this current offering possessed a structure similar to US Government bonds, semi-annual interest payments with the principal being repaid upon maturity.
According to the capital-raising program of the Debt Management Unit, an additional offering with US guarantees is planned to take place during the last quarter this year, at a volume of approximately $1.4 billion. — (menareport.com)
© 2003 Mena Report (www.menareport.com)
