Cocoa Capital PLC has raised GH¢3.39 billion from domestic investors through its first commercial paper issue, marking a major step in Ghana Cocoa Board’s (COCOBOD) shift towards locally sourced financing for cocoa purchases.
The funds were raised at an interest rate of 11 per cent, with the 266-day securities due to mature on June 28, 2027. The transaction is part of a broader GH¢16.3 billion financing programme designed to support cocoa purchases and refinance existing cocoa-related debt.
The scale of the fundraising is particularly striking given that Cocoa Capital was incorporated on August 7, 2026, with stated capital of just GH¢5 million.
Its first financial statements, covering the period up to September 30, show total assets of GH¢5 million, a start-up loss of GH¢100,000 and no cash balance at the reporting date. The company also recorded GH¢100,000 in other payables, leaving its total equity at GH¢4.9 million.
The accounts, however, reflect the company’s position before the commercial paper issue was completed. They show that the GH¢5 million in share proceeds was due from COCOBOD and was received in October.
The GH¢100,000 loss was also recorded during the company’s initial operating period. The financial statements do not provide a detailed breakdown of the expenses responsible for the deficit.
Cocoa Capital was established as a special-purpose vehicle to mobilise funding for COCOBOD, rather than operate an independent cocoa-trading business. Its role is to raise money that can be channelled into the purchase of cocoa beans.
The inaugural commercial paper issue attracted total investor demand of GH¢3.59 billion, but only GH¢3.39 billion was accepted and allocated. This means demand exceeded the final allocation by GH¢200 million.
However, the amount raised fell short of the indicative GH¢4 billion first-tranche figure presented to investors.
The issue forms part of the GH¢16.3 billion Domestic Cocoa Notes Programme, which is expected to raise up to GH¢14 billion through commercial paper to finance cocoa purchases for the 2026/27 season. Another GH¢2.3 billion is earmarked for bonds to refinance existing Domestic Debt Exchange Programme cocoa bonds.
With GH¢3.39 billion raised so far, approximately GH¢10.61 billion remains to be mobilised if the full commercial paper target is to be achieved.
The financing arrangement is intended to reduce COCOBOD’s dependence on the traditional buyer-financed system and offshore borrowing by bringing domestic institutional investors into the funding of seasonal cocoa purchases.
Under the structure, proceeds from selected cocoa forward-sale contracts will be assigned to designated, ring-fenced accounts. The money collected through these arrangements will then be distributed according to an agreed payment structure, including the repayment of investors.
The arrangement is designed to ensure that money generated from cocoa sales provides a defined source of repayment for the securities.
However, its effectiveness will depend on the performance of the underlying contracts, the timing of cocoa-sale proceeds and how efficiently the funds are managed.
The GH¢3.39 billion raised is also significantly larger than Cocoa Capital’s initial stated capital, representing about 678 times its GH¢5 million share capital. This does not mean the company is expected to repay the debt from its share capital alone, as the financing model relies on assigned cocoa-sale receivables.
The funds are expected to support cocoa purchases and provide financing for Licensed Buying Companies responsible for purchasing beans from farmers.
While the successful placement provides an important source of funding, it does not automatically guarantee that money will reach purchasing companies on time throughout the season or that cocoa-sale proceeds will be sufficient to meet repayment obligations.
Future financial statements will therefore be important in assessing how the commercial paper affects the company’s liabilities, cash flows and interest expenses. They will also provide a clearer picture of the receivables supporting the financing and the movement of funds between Cocoa Capital and COCOBOD.
For now, the GH¢3.39 billion issue marks Cocoa Capital’s transition from a newly incorporated company into a major financing vehicle for Ghana’s cocoa sector. The bigger test will be whether it can sustain the fundraising programme, support timely cocoa purchases and meet its repayment obligations from the proceeds of cocoa sales.
