Nigeria Back at International Capital Market with Eurobond Offer

Proshare

Friday, September 17, 2021 / 08:59 AM / by DMO Nigeria / Header Image Credit: SeeNews

 

The Federal Government of Nigeria has announced plans for a Eurobond issuance in the International Capital Market (ICM). The last time Nigeria accessed the ICM was November 2018. 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 Bookrunner (Chapel Hill Denham Advisory Services Ltd) was appointed as one of the Transaction Advisers.


Through the Eurobond issuance, Nigeria is expected to raise up to USD$3 billion but no more than USD$6.2 billion. 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.


Proshare Nigeria Pvt. Ltd.


In addition to providing funding to part-finance the deficit in the 2021 Appropriation Act, the issuance of Eurobonds by Nigeria benefits the country in many other strategic ways; amongst which are:

  1. It is an inflow of foreign exchange, leading to an increase in External Reserves. External Reserves help support the Naira Exchange Rate, and Nigeria's sovereign rating.
  2. When Nigeria raises funds externally, through Eurobonds, it frees up space in the domestic market for private sector and sub-national borrowers. In effect, it helps the sovereign not to crowd out other borrowers in the domestic market.
  3. The issuance of Eurobonds by Nigeria has 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 has been strengthened to provide banking services whilst also meeting regulatory requirements. Nigeria has a sovereign yield curve in the ICM, extending up to 30 years.
  4. The local listing of Nigeria's Eurobonds on the Nigerian Exchange Ltd. and the FMDQ Securities Exchange Ltd., have increased the range of products on these two (2) exchanges and their respective market capitalization.


Overall, Eurobond issuances by Nigeria and the investor meetings that precede the pricing, have provided a strong global platform for Nigeria to tell its own story and opportunities available in Nigeria for investors.


The Transaction Advisers appointed by Nigeria for the issuance are:

International Bookrunners/          -     JP Morgan, Citigroup Global Markets Limited,

Joint Lead Managers                       -  Standard Chartered Bank and Goldman Sachs.

Nigerian Bookrunner                      -     Chapel Hill Denham Advisory Services Ltd

Financial Adviser                              -      FSDH Merchant Bank Ltd                    

International Legal Adviser          -     White & Case LLP  

Nigerian Legal Adviser                    -   Banwo & Ighodalo


Proshare Nigeria Pvt. Ltd.


Related News

1.      Fitch Assigns Nigeria's Proposed USD Bond 'B' Rating

2.      2021 Appropriation Act: FGN Appoints Transaction Advisers for a Eurobond Issuance

3.      MTNDP 2021-2025: A Hope for Revival or Keeping up With the Joneses?

4.      2022-2024 MTEF and FSP Will Provide Guidance to MDAs

5.      DMO Issues Update on the N2.343trn New Capital Raising in the 2021 Appropriation Act

6.      President Buhari Requests for NASS Resolution for N2.343trn New Capital Raising

7.      2021 Budget: FG Asked to Block Loopholes And Investigate 314 Duplicated Projects

8.      BudgIT Highlights Corruption Loopholes in the Budget Process, Calls for Urgent Budget Reforms

9.      2021 National Budget - KPMG Review and Implementation Notes

10. Budget Shortfalls and Revenue Underperformance

11. DMO Provides Clarification on the N2.2trn Debt Service Provision in the 2018 Appropriation Act

12. Budget and National Strategy: Leverage and Synergy Potentials

13. Lagos State Budget 2021: Rekindling Hope, Riding Expectations

14. 2021 Budget to Focus on Security, Human Capital Development and Infrastructure - Zainab Ahmed

15. President Signs the Appropriation Bill, 2021 and Finance Bill, 2020

16. Nigeria's Growing Budget Deficit

17. President Buhari Signs Nigeria's 2021 Appropriation Bill and Finance Bill Into Law

18. President Buhari Signs Budget 2021 into Law

19. 2021 Proposed Budget Review: Galloping Spending, Weakening Revenues

20. Subpar Expenditure, Subpar Revenue Collection

21. Nigeria's 2021 Budget of Economic Recovery and Resilience

22. FGN Proposes Unprecedented Deficit to Drive Economic Recovery

23. Nigeria's 2021 Budget of Economic Recovery and Resilience


Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.

READ MORE:
Related News
SCROLL TO TOP