The transaction now the largest issue in the debt capital market in 2021
Having registered a strong presence in Commercial Paper (CP) issuance in the Nigerian debt capital market, MTN Nigeria communications has announced the successful completion of its N110 billion Series I bond issuance for a 7 year tenor of 13.0 per cent fixed-rate bond due 2028 under its N20 billion bond issuance programmes. The Series I bond is regarded as the largest corporate bond issuance in the debt capital markets so far in 2021.though, the telecom giant had initially indicated the intention to raise N100 billion in Series I of the registered Shelf programme.
MTN Nigeria, in a disclosure filed to the Nigerian Exchange Group (NGX), revealed that the book build process of the transaction that was launched on April 9 2021 was completed on April 16 2021. It also disclosed that the transaction was well received with active participation from a wide range of high value and quality investors including pension funds, funds managers, banks, insurance companies, trustees, corporates and high net worth individuals.
During the issue, MTN Nigeria revealed, a total order value worth N132,151,000,000 was received during the book build process, representing a 1.32x oversubscription of the intended N100 billion issuance. It also stated that the issue was launched at a clearing coupon of 13.0 per cent with N110 billion in qualified bids.
Karl Tariola, the chief executive officer, MTN Nigeria, while commenting on the bond issuance said, “we are very proud of this landmark transaction, which is the first-ever telco bond issued in Nigeria and the largest corporate bond issuance this year. The domestic debt capital market has given us the opportunity to further diversify our funding sources and extend the maturity of our debt portfolio and profile to match investment in infrastructure. The strong support for this transaction, given the challenging environment, is a reflection of the depth of the market, and investor confidence in MTN Nigeria’s long-term strategy, our management team, and the overall telecoms industry.”
The largest wireless carrier in Africa said that the bond issuance reinforces the company’s strategy of diversifying its funding sources and reflects its market leadership and strong credit quality, as well as the resilience of the domestic debt capital market. The net proceeds will partly be used to refinance existing debt and support the roll-out of critical network infrastructure.
Meanwhile, Chapel Hill Denham Advisory Limited has been announced to have acted as the Lead issuing house while Stanbic IBTC Capital, DLM Advisory, FCMB Capital Markets, FBNQuest Merchant Bank, Rand Merchant Bank, and Vetiva Capital Management acted as the joint issuing houses to the transaction.
Frontpage August 23, 2019