Oil and Gas

Ecopetrol issues $2 billion in bonds to refinance ISA loan

BOGOTA, Oct 28 (Reuters) - Colombia’s majority state-owned oil and gas company Ecopetrol issued $2 billion in bonds to international markets, with proceeds destined to partially refinance a loan it used to buy a majority stake in energy conglomerate ISA, it said.

Ecopetrol issued the bonds in the over-subscribed offering on Wednesday with approval from Colombia’s finance ministry.

The company previously agreed to buy the Colombian government’s 51.4% stake in ISA for $3.77 billion as part of its plan to become an integrated energy company.

In August, Ecopetrol received the green light to agree a loan worth up to $4 billion with international banks to pay for the deal.

The bond issue saw demand of more than $7.6 billion, Ecopetrol said, with investors based in the United States, Europe, Asia and Latin America.

The issue included $1.25 billion in 10-year bonds at a rate of 4.625%, as well as $750 million in 30-year bonds at a rate of 5.875%, the company said in a statement.

In August, Ecopetrol’s board approved the possible issuing of shares which could reduce the state’s stake in the company to a minimum of 80% over the next five years.

Colombia currently owns some 88.49% of Ecopetrol shares. (Reporting by Luis Jaime Acosta Writing by Oliver Griffin Editing by Mark Potter)