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FG Appoints Transaction Advisers For N2.3trn Eurobond

Ololade Omosan-Agie

The Federal Government has appointed Transaction Advisers for its Eurobond issuance programme.

Typical of   Eurobond   issuance,   Transaction   Advisers   of   various   categories   are required to work with an issuer, in this case Nigeria, to ensure the success of the transaction. 

The institutions approved by the Federal Executive Council at its meeting   on   Wednesday,   to   advise   on   the   Eurobond Issuance are     JP Morgan, Citigroup Global Markets Limited, Standard Chartered Bank and Goldman Sachs.

Others are   Chapel Hill Denham Advisory Services Ltd, FSDH Merchant Bank Ltd, White & Case LLP,  and   Banwo & Ighodalo.

The Debt Management Office confirmed the approval by FEC in a statement issued in Abuja on Wednesday.

The   Transaction   Advisers, according to DMO emerged   from   an   Open   Competitive   Bidding Process as outlined in the Public Procurement Act, 2007 (as amended).

A total   of  38 institutions   responded   to   the   Expression   of Interest,   and   after   rigorous   evaluation   to   ascertain   the   technical capacities   of   the   responders   to  execute   the   Transaction,   the   eight   institutions   were  selected.   

With  the   approval  of   the  Transaction Advisers by FEC, the DMO will now accelerate activities towards the Issuance of the Eurobonds. 

It will be recalled that the   Resolutions   of   the   Senate   and   the   House   of   Representatives,   in compliance with the Debt Management Office (Establishment, Etc.) Act, 2003 and Fiscal Responsibility Act, 2003, had earlier been secured.

The Euro-bonds to be issued, are for the purpose of raising funds for the New External Borrowing of N2.343trn (about $6.2bn) provided in   the   2021   Appropriation   Act   to   part  finance   the   deficit.   

While  the Government expects a successful outing, the DMO said it will be mindful of costs and risks   (in   terms   of   tenor   and   pricing)   in   determining   the   amount   of Eurobonds to issue.

It said since the Eurobonds are being issued to part finance the 2021 budget deficit, the proceeds will be used to fund various projects in the Budget.

In addition, it said the proceeds will result in an inflow of foreign exchange which in turn, will increase Nigeria’s External Reserves and support the Naira exchange rate.

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