Leading infrastructure solutions provider on the continent, Africa Finance Corporation (AFC), said on Wednesday that it spearheaded the Federal Government of Nigeria’s (FGN) first-ever domestic dollar bond issuance, raising US$900 million and contributing significantly to the nation’s economic progress.
In relation to the first-ever issuance for Nigeria’s capital market, AFC served as Global Coordinator. The bond, which was issued at par, has a five-year tenor and a 9.75 percent annual coupon. The issue concluded with a 180 percent oversubscription, demonstrating the effectiveness of AFC’s strategic leadership in the capital markets and the high level of confidence held by domestic investors in Nigeria’s economic stability and growth prospects.
The investor base for this domestic issue consisted of institutional investors, Nigerians living abroad, and Nigerians residing in Nigeria. The Nigerian Exchange Limited (NGX) and FMDQ Securities Exchange Limited (FMDQ Exchange) will list and offer trading for the bond.
The issuance’s success highlights AFC’s crucial role in assisting the Nigerian government in realizing its goals of expanding financial inclusion, strengthening local capital markets, and diversifying sources of funding. It is the inaugural issue under the Domestic US Dollar Bond Program of the FGN.
“This inaugural domestic US dollar bond issuance is a significant achievement for Nigeria and marks a new chapter in the development of the country’s capital markets,” said Banji Fehintola, executive director and head of financial services, Africa Finance Corporation.
“We are honoured to have played a leading role in this landmark transaction as the global coordinator, which aligns with AFC’s mission to develop domestic capital markets in Africa by providing innovative financing solutions that meet the continent’s unique needs and also leveraging our deep capital market expertise to serve and deliver value to our clients.
This successful issuance not only showcases Nigeria’s economic potential but also reinforces the benefits of African nations looking inward to tap the deep pool of domestic capital on the continent and taking the lead in financing their development.
AFC has a solid track record in capital markets with a well-established diverse investor engagement program that included the issuance of a US$1.16 billion global syndicated loan earlier this year.
Alongside AFC’s role as Global Coordinator for domestic bond issuance, United Capital Plc acted as Lead Issuing House/Coordinator; Meristem Capital Limited, Stanbic IBTC Capital Limited and Vetiva Advisory Services Limited acted as Issuing Houses; Constant Capital Markets & Securities Limited and Iron Global Markets Limited acted as Financial Advisers; Olaniwun Ajayi LP and G. Elias acted as Solicitors; and Greenwich Trustees Limited acted as Trustee.
