The Nigeria Africa Finance Corporation has raised $400 million in a new syndicated loan to help with post-pandemic recovery and infrastructure development.
The three-year facility, which is AFC’s first since 2018, was increased from an initial target of USD$300 million due to robust investor demand, with the offering 2.5 times oversubscribed. The funds will be used to help fund prospective infrastructure projects that will address Africa’s developmental challenges.
“The transaction demonstrates the confidence of banking partners, both old and new, in AFC’s strong credit risk profile and broadening global appeal in the capital markets,” said Banji Fehintola, Senior Director & Treasurer at AFC.
He added, “This loan will be instrumental in working towards plugging the infrastructure gap we are facing on this continent, especially following the damaging effects of the Covid-19 pandemic. We remain committed to partnering with experienced, like-minded organizations to provide sustainable finance for infrastructure development in Africa, while achieving the lowest borrowing costs of any institution on the continent.”
The outlook for AFC’s investment grade credit ratings was recently upgraded to ‘stable’ by Moody’s. It has the second highest senior unsecured ratings in Africa, at A3, and the second-highest short-term issuer ratings, at P-2.
Flexible financial tools and further diversification of AFC’s investment portfolio will be enabled by new ties formed with the varied pool of foreign investors behind the syndicated loan.
Absa Bank Limited (acting through its Corporate and Investment Banking division), Bank of China Limited, London Branch, First Abu Dhabi Bank PJSC, ICBC (London) plc, Mashreq Bank PSC, MUFG Bank Ltd, Nedbank Limited, London Branch, Rand Merchant Bank, a division of FirstRand Bank Limited, London Branch, Standard Chartered Bank and SMBC Bank International plc, acted as Bookrunners and Mandated Lead Arrangers (“BMLAs”), whilst Korea Development Bank and Standard Bank of South Africa acted as Mandated Lead Arrangers (“MLAs”). MUFG Bank Ltd and ICBC (London) plc also acted as Facility Agent and Documentation Agent respectively.
