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DMO seeks multimillion-dollar bond arrangers

05 September 2013, 14:32

Lagos  -  The Debt Management Office (DMO) is seeking an international bank and a local lender to act as co-arrangers for the N80 billion (US$480 million) depository note it will issue before the end of the year.

According to a DMO notice, bids for co-arrangers are due on October 3.

The arranger will be responsible for advising Nigeria as to the type of facilities it requires and then negotiating the broad terms of those facilities while the co-arranger is expected to find more lenders to participate in the facility.

Depository notes are used for short-term investment of funds in various currencies.

Their advantages include flexibility, maturing between 14 and 365 days.

Nigeria is increasing the amount it borrows from overseas to about 40 percent of all debt over the next three to five years from 12 percent and seeks lower funding costs.

In May, the DMO said it would issue N80 billion in global depository notes this year, after a $1 billion Eurobond, to deepen its footprint in international debt markets.

Citibank and Deutsche Bank acted as advisers on the $1 billion Eurobond issued in July. The bond was oversubscribed by more than four times.

Nigeria also plans to issue $100 million in Diaspora bonds this year and is seeking advisers.

The DMO said the depository note will be documented under United States rules and listed in Europe.

Meanwhile, the DMO said in a notice that it had appointed a sole depository bank and an arranger for the offering.

It did not reveal the identity of the institution.

The DMO was established in 2 000 to centrally coordinate the management of Nigeria’s debt, which was until then being done by a myriad of establishments in an uncoordinated fashion, leading to inefficiencies.

– CAJ News

Tags bonds

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