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Nigeria’s $2.86 Billion Eurobond Offers More But Gets Less
LAGOS (Capital Markets in Africa) – Nigeria’s sale of $2.86 billion eurobonds failed to attract as much interest as previous issues even though it offered yields that were considerably higher.
Friday’s offering in London, issued in three tranches, attracted bids of $9.5 billion for notes with yields as high as 8.75 percent and 9.25 percent for two of the tranches. Earlier this year a $2.5 billion, two-tranche offering of 12- and 20-year securities, yielding 7.14 percent and 7.7 percent, was more than four times oversubscribed.
“When Nigeria issued a eurobond in February last year, it was 8 times oversubscribed,’’ Ayo Teriba, the chief executive officer of Economic Associates Ltd., a Lagos-based advisory firm, said by phone. At that sale, $1 billion of 15-year bonds were sold yielding 7.875 percent.
Friday’s sale was a “demonstration of confidence in Nigeria’s economy,” the Ministry of Finance said in a Twitter post Friday.
Sluggish economic growth probably weighed on Friday’s auction, Chinwe Egwim, an economist at FBN Quest Merchant Bank, said in emailed comments.
Source: Bloomberg Business News