Ecopetrol, Colombia’s state-owned oil company, has successfully issued $1.75 billion in public external debt bonds.
The company plans to use these funds to buy bonds maturing in 2026 and prepay other obligations. The bond sale attracted considerable interest from investors.
Demand exceeded the amount offered by 2.6 times, with over 200 investors from the United States, Europe, Asia and Latin America participating.
This strong response shows the confidence of the international market in the financial stability of Ecopetrol. Ecopetrol emphasized that the bond issuance reflects its solid credit profile.
The company achieved favorable terms, with the lowest spread and coupon achieved in the last two years. This result suggests that investors see Ecopetrol as a reliable borrower despite recent political developments.
The bond sale came a week after the National Electoral Council opened an investigation into Ecopetrol’s president, Ricardo Roa.
Ecopetrol’s bond sale amid political uncertainty
The investigation is related to the campaign of President Gustavo Petro, who had initially forced the company to postpone the bond operation. The bonds, set to mature in 2032, were sold at a yield of 7.8%.
That rate was slightly higher than the 7.65% yield that Ecopetrol officials had originally expected, according to Bloomberg. The difference may reflect some investor caution due to the ongoing political situation.
In addition to issuing new bonds, Ecopetrol announced details of the repurchase offer for bonds maturing in June 2026. The company set the repurchase price at $1,011.90 for every $1,000 of nominal value.
This move aims to effectively manage the company’s debt profile. Roger Horn, a senior emerging markets strategist at Mariva Capital Markets, commented on the rapid return to the market.
He suggested that investors may be more bullish on political headlines than bankers had anticipated. Horn also noted the positive signal sent by opening the market to a traditional quasi-sovereign oil company.
The successful bond sale shows that Ecopetrol maintains access to international capital markets. This approach is essential to the company’s continued operations and future investments in Colombia’s energy sector.
