FG Woos Local Investors, Opens $3bn Eurobond Borrowing Plan

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DG, Debt Management Office, Patience Oniha-Brand Spur Nigeria
DG, Debt Management Office, Patience Oniha-Brand Spur Nigeria

The Debt Management Office has disclosed that Nigeria is back in the International Capital Market after about three years with a plan to raise at least $3bn from Eurobond issuance.

This was contained in a statement titled ‘Nigeria back at International Capital Market with Eurobond offer’ issued by the DMO’s spokesperson, Chinenye Onu, on Thursday.

The statement read, “The Federal Government of Nigeria has announced plans for a Eurobond issuance in the International Capital Market.

“The last time Nigeria accessed the ICM was November 2018.”

The statement further disclosed that there would be virtual meetings with investors on September 17 and 20, adding that the meetings are open to local investors for the first time.

“Virtual meetings with investors have been scheduled for September 17 and September 20,2021.

“In order to avail local investors the opportunity to invest in the Eurobonds, meetings will also be held with local investors.

“This is the first time local investors will be included in the roadshows, and this is one of the reasons why a Nigerian Book runner (Chapel Hill Denham Advisory Services Ltd) was appointed as one of the transaction advisers,” it stated.

FG Woos Local Investors, Opens $3bn Eurobond Borrowing Plan

It further stated, “Through the Eurobond issuance, Nigeria is expected to raise up to $3bn but no more than $6.2bn.

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“The issuance for which all statutory approvals have been received, is for the purpose of implementing the New External Borrowing in the 2021 Appropriation Act.

“Proceeds are for the financing of various projects in the Act.”

The statement disclosed that beyond providing funding to part-finance the deficit in the 2021 Appropriation Act, the issuance of Eurobonds would help to increase external reserves and support the naira exchange rate and Nigeria’s sovereign rating as well as free up space in the domestic market for the private sector and sub-national borrowers.

It added that the issuance of Eurobonds by Nigeria had opened up opportunities for Nigeria’s corporate sector notably banks, to issue Eurobonds to raise capital in the ICM.

By so doing, their capital base had been strengthened to provide banking services whilst also meeting regulatory requirements, the statement said.

The PUNCH earlier reported that the Federal Government had appointed transaction advisers to facilitate the issuance of Eurobonds in the international capital market.

The transaction advisers appointed by Nigeria for the issuance included JP Morgan, Citigroup Global Markets Limited, Standard Chartered Bank, Goldman Sachs, Chapel Hill Denham Advisory Services Ltd, FSDH Merchant Bank Ltd, White & Case LLP, and Banwo & Ighodalo.