Kogi restructures N8b bonds

Regulatory report at the Nigerian Stock Exchange (NSE) indicated that the capital market provided critical funding in debts and equities to governments and companies, with sustained activities all through the lockdowns and disruptions occasioned by COVID-19 pandemic and global economic uncertainties.

A breakdown of the fund-raising entities showed five broad categories- Federal Government, state governments, quoted companies, fund management finds and special purpose vehicles (SPVs).

The issuers or fund-raising entities included sovereign issuances by the Federal Government of Nigeria, sub-national issuances by the Ondo State Government, debts and equities raising by several quoted companies including Dangote Cement, Flour Mills of Nigeria, Consolidated Hallmark Insurance, Coronation Insurance, formerly Wapic Insurance, International Breweries and Golden Guinea Breweries.

Other corporate issuers included Abbey Mortgage Bank, C & I Leasing, UACN Property Development Company (UPDC), United Capital, AIICO Insurance, Red Star Express and Interswitch Africa One. Investment management companies such as ARM Investment Managers and Meristem Wealth Management also launched new collective investment schemes.

The market particularly provided innovative finance through SPVs to support key infrastructural development and corporate restructuring. These included issuances such as Axxela Funding 1, LAPO MFB SPV, FBNQ MB Funding SPV and Primero BRT Securitisation SPV.

Preliminary data showed that the federal Government, which sustained a monthly savings bond issuance alongside mid to long-term general bond issuances, dominated the capital raising with nearly N1.9 trillion. Companies raised about N364 billion in debts and equities while other issuers raised about N56 billion.

There were also many landmark transactions during the period. Nigeria’s largest quoted company and Sub-Saharan Africa’s largest cement company, Dangote Cement during the year floated its maiden bond, a N100 billion bond, the largest single corporate bond issue in the Nigerian capital market. Dangote Cement indicated it would apply the net proceeds of the bond to refinance existing short-term debt previously applied towards cement expansion projects, working capital and general corporate purposes.