Freight transport and logistics company Transnet has successfully issued a $1 billion bond in the US, it said on Friday.

“The bond is the highest amount of money that has ever been raised by Transnet in a single issuance without a government guarantee. At 10 years to maturity, it is also the longest tenor ever issued by Transnet in the international debt capital markets.

“The bond was competitively priced at 262.5 basis points above the 10-year US Treasuries,” group chief executive Brian Molefe said.

The bond, which was significantly oversubscribed, was issued at an interest rate of 4% following road shows in Europe and the US.

According to the parastal, this confirmed the confidence of the international financial markets in the company’s R300 billion Market Demand Strategy (MDS) as well as government’s infrastructure development programme.

Earlier this year, President Jacob Zuma announced the country’s infrastructure development programme, in which more than R800 billion will be invested until 2014.

The proceeds from the latest issue will be used to finance the company’s capital investment programme, which is focused on rejuvenating and modernising Transnet’s rail, port and pipelines logistics infrastructure as well as for general corporate purposes.- SAnews.gov.za