Dipo Olowookere
By Dipo Olowookere
Commercial papers worth N15 billion issued by United Capital Plc were recently mopped up by institutional investors, who were mainly asset managers.
A statement issued by the firm disclosed that the exercise was highly successful as it recorded a subscription level of about 112 per cent.
Recall that in April 2020, the organisation sold the short-term debt instrument worth N5.3 billion in two series, series 1 and series 2 and issued in two tenors; 182 days and 270 days, with the longer maturity preferred by investors based on the subscription level.
In the third series, the company raised N15 billion with a tenor of 270 days and at a yield of 1.26 per cent, the lowest issued by a non-bank.
“Following its debut Series 1 and 2 Commercial Paper issuance of N5.3 billion in April 2020, United Capital Plc has successfully raised N15 billion in its recently-issued Series 3 Commercial Paper under a N20 billion programme registered with the FMDQ Securities Exchange.
“The Series 3 270-day issuance was issued at a yield of 1.26 per cent and had a subscription of circa 112 per cent with firm commitments from a pool of institutional investors, particularly asset managers,” a part of the statement issued by the company stated.
Commenting on the sale of the debt securities, the Group Chief Executive Officer of United Capital, Mr Peter Ashade, stated that, “The commercial paper issuance is in line with our bid to diversify our funding sources, strengthen our capital base and intensify our strategic initiatives aimed at providing innovative financing solutions to our clients.”
The company also noted that the “issuance sets another ground-breaking record in the Nigerian capital markets, being the lowest yield on record for a 270-day CP issuance by a non-bank issuer.”
Concluding, the company disclosed in the statement that FSDH Capital Limited, United Capital Plc and UCML Capital Limited acted as arrangers to the transaction.
