As part of its ongoing efforts to restructure Ghana’s energy sector debt, E.S.L.A. PLC has announced plans to redeem approximately GH¢3.47 billion in outstanding bonds.

This decision is in line with the country’s broader debt restructuring initiatives.

In a statement released on Tuesday, November 5, E.S.L.A. PLC confirmed that it would engage its bondholders for the redemption of these bonds at par value on December 2, 2024.

This move is part of a larger strategy to address Ghana's energy sector debt challenges.

The redemption follows a significant milestone earlier in October when E.S.L.A. PLC completed a 90% buyback of GH¢1.04 billion worth of bonds, effectively reducing the company’s liabilities.

The bonds that are set for redemption include Tranches E2, E3, E4, and E5, with maturity dates spanning from 2027 to 2033.

The company hopes this initiative will alleviate the debt burden in the energy sector and provide relief to bondholders.

“This meeting aims to authorise modification of the final maturity or redemption date and interest payment dates of all the company’s outstanding bonds to Monday, 2nd December 2024,” the company stated in a formal notice to investors.

E.S.L.A. PLC was founded in 2017 as a special purpose vehicle designed to tackle Ghana’s energy sector debt.

By issuing debt securities backed by an energy debt recovery levy under the Energy Sector Levy Act of 2015, the company has raised over GH¢10.5 billion.

As of December 2022, approximately GH¢8.4 billion of this remains outstanding.

On November 26, 2024, a virtual meeting for bondholders will take place. During this meeting, stakeholders will discuss proposed changes to the bond maturity dates and interest payment schedules to align with the planned redemption.

Bondholders will also have the opportunity to vote on the proposal to advance the redemption date.

According to the company’s formal notice, the purpose of the meeting is to secure approval for modifying the final maturity and redemption dates of all outstanding bonds, setting them to December 2, 2024.

The company’s improved financial position supports its buyback efforts. Unaudited financial statements for September 2024 show assets of GH¢5.32 billion, with GH¢3.79 billion in cash.

E.S.L.A. PLC also reported a decline in liabilities from GH¢5.03 billion in September 2023 to GH¢4.81 billion in September 2024. Additionally, the company saw significant profit growth, reaching GH¢165.75 million in the third quarter of 2024, compared to GH¢51.90 million during the same period in 2023.

This improved financial standing is in alignment with Ghana’s broader debt sustainability goals, particularly through the government’s Domestic Debt Exchange Programme (DDEP). Under this initiative, bondholders were offered new government bonds in exchange for E.S.L.A. PLC bonds, helping to reduce overall debt and allowing bondholders to settle earlier than originally scheduled.

Bondholders are encouraged to attend the upcoming virtual meeting, either in person or via proxies, as it aims to finalize the company’s debt restructuring plan. This effort will ensure greater financial stability for E.S.L.A. PLC while contributing to resolving Ghana’s long-standing energy sector debt issues.