Nigeria back at Int’l Capital Market with Eurobond offer

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The Federal Government of Nigeria has announced plans for a Eurobond issuance in the
International Capital Market (ICM). The last time Nigeria accessed the ICM was NovemberVirtual meetings with investors have been scheduled for September 17 and September
20, 2021. In order to avail local investors the opportunity to invest in the Eurobonds, meetings
will also be held with local investors. This is the first time local investors will be included in the
Roadshows, and this is one of the reasons why a Nigerian Bookrunner (Chapel Hill Denham
Advisory Services Ltd) was appointed as one of the Transaction Advisers.

Through the Eurobond issuance, Nigeria is expected to raise up to $3 billion but no more
than $6.2 billion. 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.
Proceeds are for the financing of various projects in the 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: 1. 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 private sector and sub-national borrowers. In effect, it helps the
sovereign not to crowd out other borrowers in the domestic market.

The issuance of Eurobonds by Nigeria 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 Transaction Advisers appointed by Nigeria for the issuance are: a) International Bookrunners/ – JP Morgan, Citigroup Global Markets Limited, b) Joint Lead Managers Standard Chartered Bank and Goldman Sachs.

c) Nigerian Bookrunner – Chapel Hill Denham Advisory Services Ltd
d) Financial Adviser – FSDH Merchant Bank Ltd
e) International Legal Adviser – White & Case LLP

f) Nigerian Legal Adviser – Banwo & Ighodalo

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