The heavily oversubscribed Nigerian government bond closes its books with a total value of almost US$7.7 billion.
On February 16th,2017 Nigeria’s US$1 billion Eurobond began trading on the London Stock Exchange (LSE).
It was the first international Nigerian bond to be issued by the country for 14 years, since 2013, and has the longest ever maturity period for any such bond from Nigeria. It will pay a coupon of 7.875 per cent and the 15-year government bond, due for redemption in 2032 has been very heavily oversubscribed.
Order book closes at almost US$7.7 billion
The listing of the US$1 billion Eurobond not only generated interest from investors in Nigeria but also from across Europe and the U.S. In fact, it was oversubscribed by almost 800%, prompting the Nigerian government to consider a supplementary issue of US$500 million, this has not however yet been implemented and the order book has now closed with a total value of almost US$7.7 billion.
The high-quality investors that successfully secured bonds are expected to both help support and finance the numerous long-term infrastructure projects currently being undertaken across Nigeria, a clear recognition of their confidence in Nigeria’s economy.
The London Stock Exchange says that this is further confirmation that the UK remains, and will continue to remain, a leading global financial center
A statement made on February 16th, 2017 by Ibukun Adebayo a representative at the London Stock Exchange Group (LSEG) said, “Nigeria’s choice of London Stock Exchange for its first international bond offering since 2013 underlines London Stock Exchange’s position as a leading global venue for debt fund raising and London’s enduring status as a market open to the world.”, adding, “The success of Nigeria’s bond listing is a strong statement of international investor interest in building exposure to Nigeria’s economy. It reinforces London Stock Exchange’s status as a strong partner to Nigeria and the City’s ability to provide a deep additional channel of finance for the development of Nigerian infrastructure and the growth of the economy.”
The British Treasury is delighted that Nigeria selected the London Stock Exchange
During a statement made by the Member of Parliament (MP) Simon Kirby, the economic secretary to the British Treasury, he reiterated that the London Stock Exchange Group (LSEG) has for a very long time been investing, supporting and in turn helping the development of African Capital Markets, with a specific focus on using African owned companies. He said, “I am delighted that the Nigerian government has chosen London as the location to list its US$1bn sovereign bond.”, adding, “This issuance underlines Britain’s position as the world’s leading global financial center and strengthens our economic and financial relationship with Nigeria.”
During his statement, he specifically mentioned five of the nine other African countries that currently also list sovereign bonds on the LSE; Gabon, Namibia, Zambia, Ghana and of course Nigeria. He also reminded the interviewer that the LSE currently has 111 African companies listed, or trading on the London Stock Exchange, more than any other international stock exchange.
The 111 African companies currently listed or trading on the LSE have a total market capitalization of in excess of US$200 billion, and in the last 10 years have raised in excess of US$26 billion on the LSE markets.