Public Sector Advisory

Public Sector Advisory
Profile:

Asset Management Corporation of Nigeria (AMCON) was established on the 19th July 2010, when the President of the Federal Republic of Nigeria signed the AMCON Act into Law. AMCON was created to be a key stabilizing and re-vitalizing tool established to revive the financial system by efficiently resolving the non-performing loan assets of the banks in the Nigerian economy.

The Programme:

The Asset Management Corporation of Nigeria issued about various tranches of bonds for the purpose of replacing the Consideration Bonds that were issued on December 31, 2010, and to also buy the new Non Performing Loans from distressed banks in the second phase

The Issue:

Radix is one of the Financial Advisers to the bond issuance programme.

Background:

  • In Jan 2008 the Lagos State Government (“Lagos State”) embacked upon a aggressive infrastructure development. it developed 7/6 robust IGR, statutory allocations and the proceeds of N275 Billion Bond issuance programme to accelerate the pace of development in the state.
  • The tranche II of the N275 Billion Bond Issuance Programme was the first ito be issued without an Irrevocable Standing Payment Orders (ISPO) and the first to be undertaken by way of a Book Build in Nigeria.
  • The 2ndseries of the N275Billion bond issue received tremendous interest with the book closing at a market clearing rate of 10% per annum and bids totaling N174.35 Billion, an over-subscription of over 249%. The tranche II was upsized to N57.5 Billion. The issue has the highest level of subscription for bond issues so far in Nigeria.
  • The book attracted very strong orders and was well distributed across institutional investors, with 47% taken up by Banks, 24% by Pension Fund Administrators (PFAs), 11% by Asset Managers (including Discount Houses), 1% by Insurance companies and 17% by other investors like mortgage houses, IT companies, stockbroking firms and trustee companies, from the domestic market in Nigeria.
  • The 7-year Bond was assigned a domestic rating of “A+” by Agusto & Co.
  • Proceeds from the Bond Issue Programme were utilised to finance selected infrastructure and ongoing capital projects within Lagos State – including upgrading the Lagos-Badagry Expressway, into a 10-lane International highway featuring pedestrians walkways, bus routes and rail lines, funding of light Rail Mass Transit Scheme and the Eko Atlantic City Project which is an “An Autonomous Urban Centre”.
  • The Bond also benefited from the incentives granted by the Federal Government of Nigeria and the CBN – including being tax exempt and being eligible to qualify as a liquid asset for local banks.
ondo Background:

Ondo State Government’s primary focus is improving the standard of living of the State’s indigenes and residents. The Government in its desire to improve infrastructural facilities within the State is invested in the transportation, power generation, industrialization, agriculture and tourism sectors of the state.

  • In January 2012 The Ondo State Government (“Lagos State”) launched the first tranche of N27Billion under the N50 billion Bond Issuance Programme.
  • The N27Billion bond issue received tremendous interest with the book closing at a market clearing rate of 15.5% per annum and bids totaling well over the amount to be raised.
  • The book attracted very strong orders and was well distributed across institutional investors.
  • The 7-year Bond was assigned a domestic rating of “A-” by Agusto & Co.
  • Proceeds from the Bond Issue Programme were used to refinance bank loans and finance selected infrastructure and ongoing capital projects within Ondo State State – These projects were selected across the Road, Water, Educational and Healthcare Projects.

The Bond also benefited from the incentives granted by the Federal Government of Nigeria and the CBN – including being tax exempt and qualification as a liquid asset for local banks.

Background:

Osun State Government’s is poised to reposition the machinery of government to set a new standard for state governance in Nigeria. In pursuit of this, the government wishes to raise funds to refinance existing loans in the books of the State and also execute capital projects required to deliver accelerated development to the people of the State.

The Programme:

The State is raising N60 billion by way of a Bond to pursue the repositioning programme.

The Issue:

Radix is a Joint Issuing House to the bond issuance programme.

Background:

Kogi State Government’s primary focus is improving the standard of living of the State’s indigenes and residents. The Government embarked on a debt issuance programme to access funds from the investing public to fund the improvement to the State’s infrastructures.

The Programme:

The State sought and got the approval to raise to N20billion in tranches. The first trance was N5Billion

The Issue:

Radix is a Joint Issuing House to the bond issuance programme.

Background:

Oyo State Government desires to ensure a stable development of the State by putting in place policies and structures, which will in turn translate to improvements in the quality of life of its people. However, the necessary infrastructure required for a fulfillment of this turn-around agenda are capital-intensive, and despite the statutory Federal allocation enjoyed by the State, there remains a gap in funding its transformation.

The Programme:

The State sought and got the approval to raise to N5billion from the Bond Market.

The Issue:

Radix is a Joint Issuing House to the bond issuance programme.

Background:

The Gombe State Government embarked on a debt issuance programme to access funds from the investing public to address its contractual liabilities and develop critical infrastructure in the state.

The Programme:

The State got the approval to raise to N30billion in tranches. The first trance was N20Billion

The Issue:

Radix is a Joint Issuing House to the bond issuance programme.

Lagos rail Background

Lagos State Government has embarked on a light rail project to improve the State’s transport infrastructure. The project involves the construction of two rail lines, the blue and red lines. The Blue line will run from Okokomaiko to Marina whilst the Red line will run from Agbado to Marina. This project will significantly improve the traffic system in the State and add value to the lives of its residents.

The Programme:

The State is setting up an innovative public-private partnership arrangement whereby the State constructs the rail network and concessions it to the identified preferred concessionaire – Eko Rail Limited.

The Issue:

Radix is a Financial Adviser to the Lagos State Government on this project which is estimated to cost about $1.5 billion.