Nigeria’s Securities and Exchange Commission approves first 15 year corporate green infrastructure bond

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The North South Power Company, through NSP-SPV PowerCorp Plc, has issued  its first N8.5 billion 15 year 15.60% Series 1 Guaranteed Fixed Rate Senior Green Infrastructure Bonds (“Series 1 Green Bonds”), due 2034 under a N50 billion Debt Issuance Programme.

The bond was issued following  the receipt of Board’s approval on September 26, 2018 to raise additional capital and the receipt of regulatory approval from the Securities and Exchange Commission on December 31, 2018.

The Series 1 Green Bonds is the first certified green corporate bond and the longest tenured (15 year) corporate bond issued in the Nigeria debt capital markets. It was oversubscribed by 60 percent with firm commitments from 12 institutional investors including 9 pension funds, and priced at 70 bps spread to the comparable 15-year sovereign benchmark bond (FGN 2034) using the closing yield on the reference date (February 4, 2019) adopted for the book building.

The bond was certified by TUV NORD CERT, an an approved verifier under the Climates Bonds Standard, in conformance with the International Capital Market Association’s (ICMA’s) Green Bond Principles, Nigerian Federal Ministry of Environment’s Nigerian Green Bond Guidelines, and the Green Bonds Issuance Rules of the Nigeria Securities & Exchange Commission.

The development of the “Green Bond Framework” and the pre-issuance verifications was obtained through technical assistance support of an initiative of the KfW Development Bank called the African Local Currency Bond Fund.

The Executive Vice Chairman and CEO of North South Power Company Limited, Engr. (Dr) Olubunmi Peters said in a statement released by the company that the success of the bond issuance is a significant milestone in the company’s long-term corporate strategy. He said the issuance of the  Series 1 Green Bonds demonstrates market leadership, innovation and commitment to the highest standards of environmental, social and corporate governance.

Peters said “with the completion of the Series 1 Guaranteed Green Infrastructure bonds issuance, the company has established a long envisioned link with a more sustainable long term, local currency financing required to implement its ambitious strategic power generation expansion plan through the capital markets”.

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