Friday, February 10, 2017

800% over-subscription recorded by Nigerian's $1bn Eurobond

The Federal Government, yesterday, said that it had issued the $1 billion Eurobond with 800 per cent over-subscription, as foreign investors demanded for $7.8 billion, reflecting investors‘confidence in the nation’s economy.

In a statement yesterday, the Ministry of Finance said that the 15-year bond was priced at 7.875 per cent and will mature on February 16, 2032. According to the statement by Director of Information, Ministry of Finance, Salisu Dambatta:  “The notes will bear interest at a rate of 7.875 percent and will mature on February 16, 2032 with a bullet repayment of the principal. 

The republic intends to use the proceeds of the notes to fund capital expenditures in the 2016 budget. The notes represent the republic’s third Eurobond issuance, following issuances in 2011 and 2013. “The notes were approximately eight times over-subscribed with orders in excess of $7.8 billion compared to a pre-issuance target of $1 billion demonstrating strong market appetite for Nigeria. 

This is despite continued volatility in emerging and frontier markets and shows confidence by the international investment community in Nigeria’s economic reform agenda. “The offering attracted significant interest from leading global institutional investors.  

The notes will be admitted to the official list of the UK Listing Authority and available to trade on the London Stock Exchange’s regulated market. The republic will apply for the notes to be eligible for trading and listed on the Nigerian FMDQ OTC Securities Exchange and the Nigerian Stock Exchange. “The pricing was determined following a roadshow led by Mrs. Kemi Adeosun, the Minister of Finance, Senator Udoma Udo Udoma, the Minister of Budget and National Planning, Mr Godwin Emefiele, Governor of Central Bank of Nigeria, Dr. Abraham Nwankwo, Director-General of the Debt Management Office, DMO, and Mr Ben Akabueze, Director -General of the Budget Office, to key global financial centres.”

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