The African Export-Import Bank (Afreximbank) has met with leading Nigerian investors to push for strong participation in the bank’s $300 million equity offering.
Dr Benedict Oramah, the President of Afreximbank, told the investors that the equity offering would be issued through depository receipts backed by its Class “D” shares for new and old investors in the bank. The Class “D” shareholders can be any investor.
Oramah said that the aim was to generate between $100 million and $300 million as part of the bank’s target to mobilise up to $1 billion to boost African trade over the next five years.
He told investors that the issuance of the receipts was to enhance the bank’s capitalisation so as to significantly narrow the trade financing gap in Africa, currently estimated at $120 billion annually.
He said that the receipts would be listed on the Stock Exchange of Mauritius and managed by SBM Asset Managers as lead arranger.
According to him, the issuance also represents an opportunity for Afreximbank to diversify its shareholder base by enabling investors in Africa and beyond who have not yet invested in the bank to do so.
He said that Afreximbank had consistently delivered development impact in its member countries including Nigeria where virtually every banking institution had benefited from its support.
Kee Chong Li Kwong Wing, the Chairman of SBM Group, said that the decision to use Mauritius was due to the country’s highly developed financial services system and its experience in similar investment drives.
Li said that as part of its support for the Afreximbank depository receipts issue, the government of Mauritius planned to grant permanent residency to investors putting in up to $500,000 into the offer.