Government approves 6 managers to raise $1bn Eurobond
The Federal Executive Council (FEC) have approved the appointment of six transaction parties for the one billion dollars Eurobond on Wednesday, December 7, in Abuja.
The approved managers include Citi Group, Standard Chartered Bank, Stanbic IBTC, Africa Practice Communications Advisors and two others.
Kemi Adeosun, the minister of finance, made the news public following the FEC meeting, which was presided over by President Muhammadu Buhari.
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The Eurobond is part of the country’s plan to borrow a total of N1.8 trillion ($5.8 billion) to fund an expected budget deficit of N2.2 trillion this year.
The minister explained the necessity of the
“The $1 billion programme is part of the funding for the 2016 budget and we hope to be able to commence that process in January.
We obtained the certificate of no objection from BPP for the appointment of those parties having undertaken a fully competitive open tender process.
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We are confident that we will be able to complete the transaction expediently as already significant interest and the oil price stability is helping us.
Currently, there is quite a bit of demand for emerging market paper. Nigeria’s paper is trading around 7 to 8 per cent mark."
Nigeria is expected to get a competitive pricing on the issuance programme which will be used to fund capital projects as part of the 2016 budget.
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The managers of the Eurobond would also run every Eurobond issuance programme in the next three years.
"The other thing to note is that these parties that have been appointed would run any Eurobond issuance programme that we do for the next three years so that we don’t have to keep on re-tendering unless there is a major problem with any of them they will be our parties for the next three years."
The Eurobond is the first tranche of a $4.5 billion Nigeria Global Medium-Term Notes Issuance Programme that runs through 2016 to 2018.
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