Stakeholders Call for Improved Capital Mobilization in Private Markets in Nigeria

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Monday, July 26, 2021 / 6:32 PM / Ottoabasi Abasiekong for WebTV / Header Image Credit:WebTV


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A growing number of financial sector stakeholders are calling for an improvement of the flows of private capital into Nigeria. Coronation Merchant Bank as part of its advocacy supporting  Nigeria's quest to become a leading destination for private capital investments, hosted its "Coronation Conversations" which centred on the theme "Capital Mobilization through the Private Markets".

 

In his opening remarks the Managing Director/CEO of Coronation Merchant Bank, Mr. Banjo Adegbohungbe, described the forum as an opportunity to facilitate productive engagements with stakeholders in the financial market. He said the theme of the event provided an opportunity,  to explore the potentials in the Nigerian capital market.

 

According to Adegbohungbe private markets are witnessing very credible and sustainable levels of financing, in areas like technology and renewable energy, thereby providing hope that a well-positioned emerging economy such as Nigeria could draw on this large pool of international investible funds.

 

Delivering the keynote address, the Chief Executive Officer of FMDQ Group, Mr. Bola Onadele Koko who was represented by Mr. Yemi Oshinubi, the MD of FMDQ Private Markets said the private markets have always existed in Nigeria, but FMDQ felt it was important to that the market be designed to provide a durable structure for its domestic growth.

 

Oshinubi noted that the global private market size was currently $7.35trn, with private equity leading in terms of the assets under management (AUM) of $4.35trn, followed by real estate $1.09trn, infrastructure and natural resources $0.88trn and private credit $0.88trn.

 

Speaking further he said the long-term growth in private markets has been quite substantial, stating that in 2020 about 11,000 firms participated in the global private market.

 

Private market expert said that since inception in 2020, the FMDQ Private Markets has seen transactions worth over N250bn. He projected that the infrastructure segment would be the biggest market growth driver in the future.

 

FMDQ's Private Markets boss added that The primary goal for establishing FMDQ Private Markets limited, was to democratize capital markets by promoting the inclusion of private companies and unleashing the largely untapped pool of private investible funds in Nigeria".

 

The FMDQ Official highlighted the following as the value proposition of the Private Markets limited to include;

  • Transparency and Information symmetry
  • Enhanced distribution channel
  • Issuer viability
  • Opportunity to stay private longer
  • Access to larger investor base
  • Light touch regulations and less burdensome documentation requirements
  • Valuation, trade and transfers

 

In terms of categorization, he said the Private Markets has structured the layers of cradleboard, growth board and main board for small and mid-size companies with potentials for growth.

 

The event featured a panel session with Chinwe Egwim, Chief Economist, Coronation Merchant Bank,  Magnus Nnoka, Chief Risk Officer, Coronation Merchant Bank,  Suru Daniels, Head Investment Banking, Coronation Merchant Bank and Wole Famurewa who served as moderator.


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Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.

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