BOI raises €700m eurobond to help businesses with financial supports

The Bank of Industry (BOI) has raised a €700 million eurobond to provide funding for the growth of businesses in Nigeria.

According to a statement by Rand Merchant Bank (RMB), the global coordinator and active bookrunner on the issuance, BOI is the first African national development finance institution (DFI) to issue a public eurobond.

It said BOI issued the €700 million eurobond by way of 144A/RegS senior note participation motes, irrevocably and unconditionally guaranteed by the federal government of Nigeria.

It also said that BOI has a vision of transforming Nigeria’s industrial sector by providing financial and business advisory services for the establishment of large, medium, and small enterprises, as well as for the modernisation of existing businesses.

“This deal represents the institution’s (BOI) first Eurobond, the provision of the sovereign’s first Eurobond guarantee, as well as the first Euro-denominated transaction from Nigeria, creating a benchmark for other prospective issuers from the region,” the statement reads.

The statement added that the five-year euro-denominated senior note instrument was issued at a yield of 7.5 percent.

“BOI’s plan is to raise up to EUR500m, but successfully raised EUR700m after a 1.5 times oversubscribed order book comprising of high-quality buy-and-hold international investors,” the statement reads.

“The transaction was preceded by an extensive three-day global virtual roadshow, including a global investor call, primarily involving engagement with investors across UK, Continental Europe, and the US.

“The notes are to be listed on the London Stock Exchange and have ratings of B2 (Stable outlook) and B (Stable outlook) from ratings agencies Moody’s and Fitch respectively.

“RMB was appointed as global coordinator and active bookrunner for the transaction alongside other banks, with RMB assisting the issuer to ensure that BOI’s unique credit story and developmental impact was best articulated to a diverse global investor base.”

Speaking on the bond issuance, Olukayode Pitan, managing director of BOI, said it is aligned with Agenda 2050 and Nigeria’s national development plan 2025.

“Agenda 2050 is Nigeria’s long-term national development plan targeted at ensuring sustained national development, as well as support Nigeria’s regional and global strategic interests. The objectives of the agenda are to lift 100 million Nigerians out of poverty in 10 years, sustain national development, and support regional and global strategic interests,” he explained.

In his remarks, Chidi Iwuchukwu, head of investment banking at RMB West Africa, expressed satisfaction with working with BOI to bring to fruition the institution’s developmental objectives to create jobs and enable growth and sustainability for businesses in different sectors of Nigeria’s economy.