The Debt Management Office (DMO) has announced that Nigeria successfully raised $2.2 billion in the international capital market through its latest eurobond auction.
This marks the country’s first eurobond issuance in two years, as it continues efforts to stabilize its economy and address fiscal challenges.
The funds will be used to finance the N9.1 trillion deficit in the 2024 budget and support the government’s broader economic reforms.
The issuance included two bonds:
A 6.5-year bond maturing in 2031, raising $700 million at a coupon rate of 9.625%.
A 10-year bond maturing in 2034, raising $1.5 billion at a coupon rate of 10.375%.
Despite being priced at $2.2 billion, the eurobond attracted a peak orderbook of over $9 billion, indicating strong interest from investors across multiple jurisdictions, including the United Kingdom, North America, Europe, Asia, the Middle East, and Nigeria.
The DMO highlighted the significant participation from fund managers, insurance and pension funds, hedge funds, banks, and other financial institutions.
“Nigeria is pleased to have attracted a wide range of investors from multiple jurisdictions…
This underscores the strong confidence in Nigeria’s macroeconomic policy framework and prudent fiscal and monetary management,” the DMO’s statement read.
The bonds will be admitted to the official list of the UK Listing Authority and made available for trading on the London Stock Exchange’s regulated market, the FMDQ Securities Exchange Limited, and the Nigerian Exchange Limited.
Finance Minister Wale Edun described the successful issuance as a major milestone, emphasizing its significance for the economy.
“This successful issuance signals increasing confidence in the ongoing efforts of the Bola Tinubu administration to stabilize the Nigerian economy and position it for sustainable and inclusive growth,” Edun said.
He also noted the diversity of investor participation as a sign of Nigeria’s strengthening position in the international capital markets.
Olayemi Cardoso, Governor of the Central Bank of Nigeria (CBN), also praised the results, highlighting the resilience of Nigeria’s credit and its improved liquidity position.
“This outcome underscores growing confidence among investors and reaffirms our ability to access international markets to support the financing needs of the government,” Cardoso added.
The issuance was managed by Chapel Hill Denham, Citigroup, Goldman Sachs, J.P. Morgan, and Standard Chartered Bank, with FSDH Merchant Bank Limited serving as financial adviser.
In November, Finance Minister Wale Edun outlined plans to raise $1.7 billion through eurobonds and an additional $500 million through sukuk financing.
These funds are part of a broader initiative to address the budget deficit and support fiscal reforms.
The successful eurobond issuance is expected to bolster Nigeria’s fiscal framework and provide much-needed funds to address pressing economic priorities.
The issuance is seen as a critical move in the government’s plan to stabilize the economy.
The overwhelming interest from global investors not only reflects confidence in Nigeria’s economic direction but also ensures liquidity to implement key reforms in the coming fiscal year.
As Nigeria positions itself for sustainable growth, this successful eurobond auction sets a strong foundation for future engagements in the international capital markets.