COCOBOD raises GH¢3.39bn from maiden domestic commercial paper issuance

The Ghana Cocoa Board (COCOBOD) has raised approximately GH¢3.39 billion through its first commercial paper issuance, using its wholly owned subsidiary, Cocoa Capital PLC, to expand domestic financing options for the cocoa sector.

The 266-day senior unsecured commercial paper was issued under Cocoa Capital PLC’s GH¢16.3 billion Domestic Cocoa Notes Programme, which seeks to mobilise funds from local investors to finance cocoa purchases and meet other sector funding requirements.

Speaking at the admission of the instrument to the Ghana Stock Exchange, COCOBOD Chief Executive Dr Ransford Abbey described the transaction as an important step towards reforming the financing structure of Ghana’s cocoa industry.

He said the initiative demonstrated how closer collaboration among public institutions, regulators, capital-market operators and domestic investors could help finance strategic sectors of the economy.

Investor interest exceeded the amount ultimately accepted, with the offer attracting bids of approximately GH¢3.586 billion from 38 institutional investors.

Cocoa Capital PLC accepted 36 bids valued at GH¢3.396 billion, with the issuance clearing at a yield of 11%.

Dr Abbey said the strong demand indicated investor confidence in the cocoa sector and the structure of the transaction. He also pointed to the domestic investment market’s capacity to support large-scale financing initiatives.

The fundraising exercise forms part of COCOBOD’s efforts to diversify its funding sources and improve its financial resilience, as cocoa purchases in Ghana have traditionally depended heavily on external financing arrangements.

According to Dr Abbey, the Domestic Cocoa Notes Programme represents a deliberate move to tap domestic savings to finance cocoa purchases and other funding needs across the industry.

The programme also incorporates measures intended to enhance transparency and impose greater discipline on fund management and repayment obligations.

As part of the arrangement, selected receivables from executed cocoa forward-sales contracts have been assigned to Cocoa Capital PLC. The proceeds are channelled through designated ring-fenced accounts and distributed according to an agreed payment waterfall.

The arrangement provides a structured mechanism for managing collections and meeting payment obligations as COCOBOD broadens its access to domestic capital.

The maiden issuance establishes an additional funding avenue for Ghana’s cocoa sector. Its longer-term contribution will depend on the programme’s ability to sustain investor interest while meeting COCOBOD’s financing needs and supporting its financial stability.