FG begins roadshow for $6.2bn Eurobonds

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Debt Management Office (DMO) said the quest to raise between $3 billion and $6.2 billion through Eurobond to part-fund the 2021 budget will commence on September 17 with virtual meetings with investors.

A statement from DMO, on Thursday, indicated that the last time federal government sought financing from the international capital market was since November 2018.

The virtual meetings with investors have been scheduled for September 17 and September 20, 2021.

According to the statement, in order to avail local investors the opportunity to invest in the Eurobonds, meetings will also be held with local investors.

It will be the first time local investors will be included in the roadshows, and this is one of the reasons why a Nigerian Bookrunner was appointed as one of the transaction advisers.

“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.

“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:  “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.

“When Nigeria raises funds externally, through Eurobonds, it frees up space in the domestic market for the private sector and sub-national borrowers.

“In effect, it helps the sovereign not to crowd out other borrowers in the domestic market.”

DMO explained that issuance of Eurobonds 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.”

The statement added that 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 exchanges and their respective market capitalization.

In addition, 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.

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FG begins roadshow for $6.2bn Eurobonds

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