Liquid Intelligent Technologies has cut its bond debt in half, announcing a new $300m (about R4.9bn) facility that replaces its previous $620m instrument.
The company, a unit of Strive Masiyiwa’s Cassava Technologies, has used bond markets to fund its activities for years.
Liquid’s debt structure now consists of $660m in new facilities, the largest being a Eurobond — listed on Euronext Dublin — that was oversubscribed 2.5 times, reflecting strong investor confidence.
Another $210m rand-denominated term loan was provided by a syndicate including Nedbank, RMB, Standard Bank, and the International Finance Corporation, which the company said serves as a “natural hedge” against Liquid’s South African revenue.
It also has a $150m US dollar-syndicated term loan provided by Ninety One and The Mauritius Commercial Bank.
Liquid said that debt is balanced by a $195m fresh capital injection from its parent company, Cassava.
This comes as the group repaid its rand term loan and dollar revolving credit facility in February, worth a combined $160m.
Net debt at the end of November — the group’s third-quarter close — was $883m, giving a net debt to adjusted earnings before interest, tax, depreciation and amortisation (ebitda) ratio of 2.96 times. The refinancing changes this, with an updated position expected when the group reports full-year earnings.
The company said the fresh financial backing reflected confidence in its Africa telecoms infrastructure business.
“The demand of that scale, against a challenging capital markets environment, points to something more than routine refinancing,” the company said after the announcement of the funding round.
“It suggests that a cohort of international institutional investors has made a considered judgement: that Liquid’s asset base, its 115,000-kilometre fibre network spanning more than 25 countries, its growing cloud and cybersecurity revenues, and its positioning at the intersection of connectivity and AI infrastructure constitute a credit that warrants allocation.”
Liquid also highlighted that anchor orders in the Eurobond were placed by “leading development finance institutions”, including Germany’s DEG.
The net result of these moves has been a significant extension of its debt maturity profile and a reduction in overall leverage. This improved financial health was the primary driver behind the recent Fitch Ratings upgrade and Moody’s placing the company on “review for upgrade.”
Hardy Pemhiwa, Liquid’s group CEO, said: “This refinancing is a significant milestone, not just financially, but strategically. A stronger, more sustainable balance sheet gives Liquid the platform it needs to pursue the full scope of digital transformation opportunities across Africa, from fibre and cloud to cyber security and AI-enabled infrastructure.”
“The quality of the institutions that participated in this transaction is a statement of confidence in Liquid’s fundamentals and in Africa’s digital growth story.”
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