The Federal Government of Nigeria’s $1bn 15-year government bonds started trading on the London Stock Exchange on Thursday.
The Eurobond is the longest ever maturity for an international Nigerian issuance, and its offer is nearly eight times oversubscribed, reaching approximately $7.7bn, highlighting strong international investor demand.
This, a statement by the LSE said, demonstrated confidence in Nigeria’s economy and reinforced London’s status as a leading global financial centre.
The statement added, “The LSE welcomes Nigeria’s $1bn Eurobond to start trading in London on Thursday. The 15-year government bond, paying a coupon of 7.875 per cent, is the longest ever maturity for an international Nigerian bond, the first international issuance for the country since 2013.
“The offer was nearly eight times oversubscribed, with the order book closing at approximately $7.7bn. The listing secured high quality investor support from across the United States and Europe and will support Nigeria in financing its long-term infrastructure projects.”
It said the listing builds on the recent pipeline of several high profile sovereign, supranational, municipal and private company bond issuances on the LSE. In January 2017, Israel listed its largest ever Eurobond offering of €2.25bn in London.
International Markets Unit – Head of Middle East, Africa and South Asia, LSE, Ibukun Adebayo, was quoted to have said, “Nigeria’s choice of the LSE for its first international bond offering since 2013 underlines the LSE’s position as a leading global venue for debt fund raising and London’s enduring status as a market open to the world.
“The success of Nigeria’s bond listing is a strong statement of international investor interest in building exposure to Nigeria’s economy. It reinforces the LSE’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 Economic Secretary to the Treasury, Simon Kirby, said, “I am delighted that the Nigerian government has chosen London as the location to list its $1bn sovereign bond.
“This issuance underlines Britain’s position as the world’s leading global financial centre and strengthens our economic and financial relationship with Nigeria.”
He added, “London Stock Exchange Group has a long history of supporting the development of African capital markets and investment in African companies. There are currently nine African sovereign bonds listed in London, from Gabon, Ghana, Namibia, Nigeria and Zambia.
“There are 111 African companies listed or trading on the LSE – more than on any other international stock exchange. These companies have a total market capitalisation of over $200bn, and in the last 10 years have raised more than $26bn on our markets.”
Seplat was the first Nigerian company to simultaneously list equity shares in London and Nigeria in April 2014.
In November 2014, the LSE Group and the Nigerian Stock Exchange signed a capital markets agreement to support African companies seeking dual listings in London and Lagos. The agreement followed the implementation earlier in 2014 of a unique new cross-border settlement process between the United Kingdom and Nigeria.