The Debt Management Office (DMO) has disclosed that it is working on issuing eurobonds and planning to appoint transaction advisers through an open bid process.
Patience Oniha, director-general of DMO, disclosed this in an interview with Reuter on Wednesday, April 7, explained that the amount to be raised would be within the foreign borrowing plans for 2021.
It was learnt that the federal government had budgeted to raise N2.34 trillion ($6.14 billion) from foreign sources.
DMO had previously planned to select advisers for a $3.3 billion eurobond issue through an open competitive bid process. Meanwhile, the sale was deferred due to the negative impact caused by the COVID-19 pandemic.
The Office planned to use last year’s eurobond sale to partly fund the 2020 budget deficit and refinance an existing $500 million eurobond due in January 2021.
In February 2021, the federal government reduced its external borrowings in a new debt strategy after it repaid a $500 million eurobond in January.
Speaking further, Oniha noted that the DMO was monitoring international markets for new issues by frontier countries.
Recall that the DMO held its last eurobond sale in 2018 (its sixth sale) where it raised $2.86 billion and issued a record $10.7 billion of international bonds in the same year.
The total subscription, according to the DMO, received from investors for the bonds was N333.48bn comprising of N65.25bn for 16.2884 percent FGN March 2027 bonds; N110.19bn for 12.5 percent FGN March 2035 bonds; and N158.04bn for 9.8 percent FGN July 2045 bonds.
The Office added that out of 82, 125 and 215 total bids for the tenures, 48, 88 and 176 were successful.
The DMO stated that a total of N262.1bn was allotted, comprising of N44.01bn, N86.29bn and N131.80bn respectively.
It said: “Successful bids for the 16.2884 percent FGN MAR 2027, 12.5 percent FGN MAR 2035 & 9.8 percent FGN JUL 2045 were allotted at the marginal rates of 10.5 percent, 11.5 percent and 12 percent respectively.
“However, the original coupon rates of 16.2884 percent for the 16.2884 percent FGN March 2027, 12.5 percent for the 12.5 percent FGN March 2035, and 9.8 percent for the 9.8 percent FGN July 2045 will be maintained.”