AFC secures ‘largest ever’ syndicated loan of $1.16bn to close Africa’s infrastructure gap

The Africa Finance Corporation (AFC) has announced the successful closing of a $1.16 billion syndicated loan — its “largest-ever” debt facility.

A syndicated loan involves two or more lenders providing loans to one or more borrowers on the same terms and with different duties, while all sign the same loan agreement.

AFC, in a statement on Tuesday, said the transaction, which took place in Dubai, attracted new lenders from the Middle East, Europe, and Asia.

The infrastructure solutions provider said the loan is a significant milestone in the company’s unwavering commitment to developing critical infrastructure projects across the continent by enhancing its financial flexibility and diversifying its investor base.

“Initially launched at US$1 billion, the three-year syndicated loan was upsized after being oversubscribed by 49%, underscoring global investor confidence in AFC’s track record, creditworthiness, and its ability to navigate the current economic landscape marked by evolving global complexities,” the statement reads.

“Proceeds from the loan will be deployed to advance AFC’s mission to consistently deliver fast and sustainable solutions to close Africa’s infrastructure gap and unleash the continent’s potential, leading to prosperity for all Africans.”

Commenting on the development, Samaila Zubairu, AFC’s president and chief executive officer (CEO), said the loan, which is its largest ever, is to ensure infrastructure projects across Africa.

“The global loan market’s overwhelming interest in Africa’s growth story is evident in the large pool of lenders that supported this syndication, making it AFC’s largest ever,” said Zubairu.

“This is a significant endorsement of our commitment to ensure that infrastructure projects support local processing and value capture, thereby providing the much-needed impetus to African industrialisation, enhanced export earnings, and job creation.”

The firm also described the loan as a testament to global capital markets and its pivotal role in fostering economic growth and industrialisation in Africa.

According to the statement, the First Abu Dhabi Bank PJSC, Mashreqbank PSC, MUFG Bank, and Standard Chartered collectively acted as Global Coordinators for the loan, while the Industrial and Commercial Bank of China (London Branch) served as China coordinator.

In addition, Abu Dhabi Commercial Bank PJSC, Emirates NBD Bank PJSC, Mizuho, and Sumitomo Mitsui Banking Corporation acted as initial mandated lead arrangers and bookrunners.

The AFC said the Bank of China and Société Générale S.A also acted as initial mandated lead arrangers.