Julius Berger Nigeria Plc, one of Nigeria’s construction giants, has announced the completion of its N30 billion Series 1 and 2 Commercial Paper (CP) issuance.
The company, in a corporate disclosure signed by its Company Secretary Mrs Cecilia Madueke, and sent to the Nigerian Exchange Limited, indicated that the commercial paper issuance was over-subscribed, demonstrating strong investor confidence in the construction firm.
Madueke stated that the issuance attracted interest from a broad range of investors such as pension fund administrators, asset managers, insurance companies, banks and high-net-worth individuals.
According to the corporate disclosure statement, the CP Issuance comprise two tenors, namely a 182-day Series 1 issuance which was priced at a 14.00% yield and a 267-day Series 2 issuance, priced at a 15.00% yield
On the company’s plans for the CP issuance proceeds, the Company Secretary further stated that the proceeds would be used to support the company’s short-term working capital and funding requirements and strengthening its competitive advantage in the construction sector in the country.
In addition, she stated that the proceeds would ensure the company’s financial flexibility in its strategic initiative to diversify into economically significant sectors, beginning with the launch of its cashew processing business.
The disclosure showed that Stanbic IBTC Capital Limited acted as Lead Arranger/Issuing and Placing Agent while FCMB Capital Markets Limited acted as Joint Arranger/IPA.
Speaking on the success of the CP Issuance, Julius Berger’s Managing Director, Dr Lars Richter, enthused: “Julius Berger is delighted to have successfully completed its debut CP Issuance in the Nigerian fixed-income market.
“This is truly a testament to the Company’s strength, the sustainability of its brand and the level of confidence Nigeria places in the Company’s services. It is without a doubt that the success of this issuance provides an avenue to optimize our funding cost while continuing to drive our strategic initiatives as an organisation.
“We are pleased by the success of the CP Issuance and grateful to the investor community for supporting the transaction”, the engineer added.
Similarly, the Chief Executive Officer of Stanbic IBTC Capital, Funso Akere, while speaking on the successful CP issuance, said: “Stanbic IBTC Capital is delighted to have acted as Lead Arranger/IPA to Julius Berger’s debut CP Issuance. As the leading investment banking franchise in Nigeria, we pride ourselves in bringing new issuers to the fixed-income and debt capital markets.
“Julius Berger has a rich history and pedigree in Nigeria, having commenced operations in 1965, and the CP Issuance availed the Nigerian investor community an opportunity to gain exposure to a top-quality corporate in the construction and infrastructure sector, thus diversifying their investment portfolios.
“The CP Issuance also allowed Julius Berger to diversify its funding sources and reduce its overall funding costs. We thank the Board and management of Julius Berger for giving Stanbic IBTC Capital a free hand to guide the process to successful completion”, Akere added.
