DMO offers 10-year N150bn Sukuk for subscription at 15.75% per annum

The Debt Management Office (DMO) has opened an offer for a 10-year N150 billion forward ijarah (lease) Sukuk instrument at a rental rate of 15.75 percent per annum, payable half-yearly.

Patience Oniha, DMO director-general, announced the offer during an event titled “2023 Sukuk Issuance – Investors Meeting” held on Thursday in Abuja.

The Sukuk is a strategic initiative that supports infrastructure development, promotes financial inclusion and deepens the domestic securities market.

Since the establishment of the initiative in September 2017, Nigeria has issued five sovereign Sukuk — 2017 (N100 billion); 2018 (N100 billion); 2020 (N162.557 billion); 2021 (N250 billion) and 2022 (N100 billion.)

Oniha said the instrument was issued by the FG Roads Sukuk Companies 1 Plc on behalf of the government.

She said the proceeds from the offer would be used for infrastructural development across the six geopolitical zones.

The offer opens on October 3 and closes on October 11 with the settlement date being October 13.

She also directed interested investors to contact the issuing houses, including Greenwich Merchant Bank Limited, Vetiva Capital Management Limited, Stanbic IBTC Capital Limited, and Buraq Capital Limited for the offer.

The director-general added that the Sukuk instrument would be listed on the Nigerian Exchange Limited and FMDQ Securities Exchange Limited.

Speaking with reporters after the event, Oniha said since the inception of Sukuk in 2017, about 4,000 kilometres of road have either been rehabilitated or constructed.

“From 2017 till this date, with N742 billion, we have been able to either construct or rehabilitate 4,000 kilometres of road and about three to four bridges,” Oniha said.

“So, there is already evidence to show what Sukuk is doing and for this current Sukuk, it is no different. It is going to impact roads and bridges as well.

“So, it is all about infrastructural financing and infrastructural development.”

The DMO boss said Nigeria’s debt stock as of June 2023, stood at N87 trillion.

“As of June 2023, Nigeria’s debt stock, which includes external and domestic for the federal and state governments as well as the FCT was N87 trillion,” she added.