INFRACREDIT GUARANTEE SUPPORTS LAGOS FREE ZONE COMPANY’S ISSUANCE OF N17.5 BILLION “AAA” RATED 20-YEAR SENIOR GUARANTEED FIXED RATE SERIES 3 INFRASTRUCTURE BONDS

Lagos, 30 March 2023: InfraCredit, a ‘AAA’ rated specialised infrastructure credit guarantee institution, is pleased to announce its guarantee of Lagos Free Zone Company’s (“LFZC”) NGN17.5 billion 20-Year Series 3 Senior Guaranteed Fixed Rate Infrastructure Bonds Due 2043 (the “LFZC Series 3 Bond”) under an upscaled NGN61 billion Debt Issuance Programme. Leveraging the irrevocable and unconditional guarantee of InfraCredit, the LFZC Series 3 Bond reinforces the benchmark set by LFZC Series I & 2

Bonds, as the third 20-year non-FGN Bond issue in the Nigerian debt capital market for the development of an industrial hub in Nigeria.

LFZC is the infrastructure development subsidiary of the Tolaram, the Singaporean conglomerate with more than 45 years of presence in Nigeria and business interests in consumer goods, infrastructure and fintech space. Lagos Free Zone (the “Zone”) is being developed as the largest integrated port based special economic zone in Nigeria and shall serve as the beacon of industrial development across Nigeria and West Africa. Enterprises operating in the Zone will benefit from various policy incentives underpinned by the legislative framework applicable for free zones in the country. In line with its vision statement – “to be the preferred industrial hub in West Africa, with world-class infrastructure”, the Zone is equipped with a host of shared industrial infrastructure necessary for attracting investments from the leading trade partners of Nigeria. Integrated with the Zone is the Lekki Deep Seaport whose construction was completed in October 2022 and commissioned by President Muhammadu Buhari on 23 January 2023 while the first commercial vessel berthed in January 2023.

Backed by an irrevocable and unconditional guarantee from InfraCredit, LFZC Series 3 Bond is accorded a ‘AAA’ long term credit rating by Agusto and Co. and GCR, reflecting the highest degree of creditworthiness for these bonds. The Series 3 Bond, a 20-Year Guaranteed Fixed Bond, was oversubscribed by 206% from institutional investors including ten domestic pension funds and an insurance company. The transaction is the third 20-year non-FGN Bond issue in the Nigerian debt capital market and reaffirms the appetite of domestic institutional investors for long tenored non-FGN instrument. The Series 3 Bond priced at a modest premium to the comparable FGN Sovereign Bond, provides a unique opportunity for pension fund managers, and other institutional investors to match their long-term liabilities with low-risk, high yield assets.

Speaking on the transaction, the Chief Finance Officer (‘CFO’) of LFZC, Mr. Ashish Khemka stated: “This is our third successful bond issuance at LFZC and it is a testament to the capacity of the Nigerian debt market as a veritable source of domestic capital for infrastructural development in Nigeria. The impressive participation and pricing of this bond issuance by the domestic institutional investors further strengthens our commitment to realize our vision and thereby enhance Nigeria’s competitive positioning with our continuous focus on Ease of Doing Business parameters. LFZ further underscores Nigeria as a compelling industrial hub within the West African coast and ideally orients itself in anticipation of the imminent single market regime under AfCFTA. We are particularly excited by the improved confidence demonstrated by pension fund managers and other institutional investors at this milestone issue and we appreciate the team at InfraCredit, StanbicIBTC Capital and other parties to the transaction for this novel structure, which helps to de-risk the transaction and aligns the interest of different stakeholders

According to the CEO of InfraCredit, Chinua Azubike, “This is yet another landmark transaction, and we are pleased to have supported the successful issuance of this Series 3 Bonds following the Series 2 issuance in 2022. Special economic zones are critical to accelerating Nigeria’s industrialization, attracting local and foreign direct investment, job creation, and inclusive growth, thus, the success of this 20-year Series III bonds reinforces the domestic market opportunity for long-term local currency financing for infrastructure projects, and the unprecedented subscription level by the domestic institutional investors signals a strong demonstration effect to governments as the country seeks private sector participation in bridging the huge infrastructure gap in the country. It is also evident that our local pension fund investors will continue to play an important role in supporting private sector led infrastructure development in Nigeria”

StanbicIBTC Capital Limited acted as Lead Issuing House/Bookrunner and Cardinalstone Partners Limited, FCMB Capital Market Limited, FSDH Capital Limited and Radix Capital Partners Limited acted as Joint Issuing Houses and Bookrunners for the transaction

For further enquiries, please contact:
Infrastructure Credit Guarantee Company Limited
Media Enquiries: [email protected]
Guarantee Enquiries: [email protected]
Phone: +234 6312300

Note to the Editor

About InfraCredit
InfraCredit is a ‘AAA’ rated specialised infrastructure credit guarantee institution backed by the Nigeria Sovereign Investment Authority, GuarantCo (a Private Infrastructure Development Group company), KfW Development Bank, Africa Finance Corporation, InfraCo Africa and African Development Bank, to provide local currency guarantees and mobilize long term debt financing for infrastructure in Nigeria. InfraCredit’s guarantees act as a catalyst to attract domestic credit from pension funds, insurance firms and other long-term investors into credit-worthy infrastructure projects, thereby deepening the Nigerian debt capital markets. InfraCredit operates on a commercial basis with a developmental role and benefits from private sector governance.
InfraCredit maintains the highest domestic financial strength ratings accorded to any financial institution by Agusto and Co. and Global Credit Ratings Co., two of the major domestic credit rating agencies. For more information please visit www.infracredit.ng and follow us on Linkedin and Twitter.

About Lagos Free Zone Company
Incorporated under the provisions of Nigeria Export Processing Zones Authority (NEPZA) Act of 1992, Lagos Free Zone Company (“LFZC”) was established in 2002 and commenced operations in 2008. Promoted by Tolaram , a Singapore based Conglomerate, LFZC is granted the right to privately develop and manage the Lagos Free Zone, located at Ibeju Lekki, Lagos. It is fully equipped with world-class infrastructure, a single window clearance for ease of doing business, and integrated with the 90 hectares Lekki deep seaport, which allows for access to regional and international markets. With a focus on the ease of doing business, Lagos Free Zone is at the forefront of serving global businesses in Nigeria. Covering 850 Hectare Area, fully integrated with the Lekki Port, LFZC is envisioned to be the preferred industrial hub in West Africa with world class infrastructure. With more than ten year of project development, LFZC has secured USD2.1billion committed investments, with USD 1.2billion investment already made. LFZC concept is to have 70%, 20% and 10% industrial, logistics & support and real estate development respectively.

The promoters of this zone are Tolaram, who are headquartered in Singapore and have been the market leaders within the FMCG business in Nigeria. Indomie noodles is one of the major success stories for the group in Nigeria. The group has forged strategic partnerships with international FMCG brands which have already setup their manufacturing plants within the Lagos Free Zone – such as Kellogg’s, Colgate, Arla Dairy, which stand as a testimony to the unrivalled investor confidence garnered by this group and the initial success of this Industrial zone.

For more information please visit https://www.lagosfreezone.com