Part of Nigeria’s decision to raise funds in 2021 has been met with some positive feedback as the nation raised $4bn in a Eurobond transaction that exceeded expectations.
As debt became more pressing, the government began 2021 plans to raise $6.1 billion offshore to fund its operations. The oil-producing nation has not been heavy on external borrowing since 2018 following the oil price dip, the decline in revenue inflow while increasing income required to repay debt interests to over 70%.
While the government had plans to offer just $3billion in a bond, multiple bids influenced the offerings. The Debt Management Office has disclosed in a statement that multiple bids had emerged from European investors, investors from America, Asia, and even Nigeria.
According to the office, “The order book peaked at $12.2 billion.” It also said the orders received were a clear demonstration of investor confidence in Nigeria.
The Eurobond was issued in three tranches:
- 7 years – $1.25 billion at 6.125% p.a.
- 12 years – $1.5 billion at 7.375% p.a.
- 30 years – $1.25 billion at 8.25% p.a.