United Capital N10bn Bond Records 124% Subscription

By Modupe Gbadeyanka

The series 1 bond issuance of United Capital Plc under its N50 billion medium-term debt programme, which was registered with the Securities and Exchange Commission (SEC) has been oversubscribed by investors.

At the exercise, United Capital raised the sum of N10 billion from a diversified institutional investors base including Pension Fund Administrators and other players in the financial service space.

The exercise, which opened on Monday, May 4, 2020 and closed on Friday, May 15, 2020, recorded a subscription level of 124 percent, affirming buy-side investors’ confidence in United Capital and a testament to the leading role of the organisation continues to play in the financial services space.

While commenting on the bond sale, which has a 5-year maturity, the Group CEO of United Capital, Mr Peter Ashade, stated that, “The bond issuance, which signifies the first by any investment bank in the history of the Nigerian capital market, solidifies our performance track record as a formidable ally in the investment banking industry.”

“With an oversubscription by 24 percent investor orders, we believe this milestone accentuates the confidence in our Institution, and its ability to diversify our corporate funding sources, provide innovative financial solutions and our unwavering commitment to our esteemed clients,” he added.

Also commenting on the transaction, the Managing Director, Investment Banking, Mr Babatunde Obaniyi, stated that, “The bond issuance adds to the impressive portfolio of innovative and landmark transactions we have structured, and once again highlights our capabilities in the successful execution of novel debt capital market transactions.”

“As a joint issuing house/book runner on the deal, the company advised on the transaction structure, securing regulatory approvals and marketing strategy for the bonds including market timing, investor road show and crafting an appropriate and compelling business case for the issuance,” he added.

Business Post reports that the N10 billion series 1 bond issuance of United Capital made the investment firm the first issuing house in Nigeria to issue a corporate bond.