North South Power Company Limited (NSP) through NSP-SPV PowerCorp Plc has issued its first N8.5billion 15 year 15.60percent Series 1 Guaranteed Fixed Rate Senior Green Infrastructure Bonds (Series 1 Green Bonds), due 2034.
This bond issuance, under a N50billion Debt Issuance Programme follows 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 (SEC) 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.
The Series 1 Green Bonds was oversubscribed by 60percent with firm commitments from twelve (12) institutional investors including nine (9) pension funds, and priced at 70 basis points (bps) spread to the comparable 15-year sovereign benchmark bond (FGN 2034) using the closing yield on the reference date (04 February 2019) adopted for the book building.
United Capital Plc acted as Lead Issuing House/Financial Adviser, while Stanbic IBTC Capital Limited, Vetiva Capital Management Limited and Zenith Capital Limited were Joint Issuing Houses to the Bond Issuance.
The bond issuance was guaranteed by InfraCredit, an ‘AAA’ rated infrastructure credit enhancement facility, backed by the Nigeria Sovereign Investment Authority, GuarantCo (a Private Infrastructure Development Group company), KfW Development Bank and Africa Finance Corporation (AFC).
The Series 1 Green Bonds was certified by TUV NORD CERT, 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 from the African Local Currency Bond Fund, an initiative of KfW Development Bank.
Olubunmi Peters, Executive Vice Chairman and CEO of North South Power Company Limited noted that the success of the bond issuance is a significant milestone in the company’s long-term corporate strategy, demonstrating its market leadership, innovation and commitment to the highest standards of environmental, social and corporate governance.
“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,” Peters said in a statement.
NSP currently generates, on the average, 8percent of Nigeria’s power providing power to millions of Nigerians and aims to be the leading power company in Sub-Saharan Africa by safely providing affordable, reliable, and sustainable power to its customer base. The medium-term objective of the Company is to contribute more than 10percent of Nigeria’s power generation output by 2020.
NSP’s vision is to be a leading sustainable power company that safely provides reliable and sustainable energy. The Company seeks to do this by leveraging technology, expertise and knowledge to provide energy and infrastructure solutions required by its customers.
The Company shares a passion to help meet the continent’s current and increasing energy needs, hence, providing communities and countries the opportunity for economic growth due to the availability of reliable and sustainable electricity.
NSP-SPV PowerCorp Plc has no subsidiaries or affiliates and has been established as a special purpose vehicle for the purpose of raising funds from the capital market to finance capital expenditure and optimize the capital structure of the Sponsor.
