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Tag: oversubscribed

  • Fed Govt bond auction for January oversubscribed

    THE first Federal Government Bond Auction for 2019 issued yesterday has been oversubscribed.

    A statement from the Debt Management Office (DMO) said the office offered three instruments with total value of N150 billion.

    Total subscriptions from investors for the bonds, the DMO said, “was oversubscribed by N197 billion, indicating a subscription level of 131 per cent”

    Read also: NASS approves N563.643bn promissory note, bond to local contractors

    Successful bids were allotted at the rate of 15.20 per cent for the five-year, 15.25 per cent for the seven-year and   15.35 per cent for the 10-year   bonds.

    “The rates for the allotments were consistent with the yields in the secondary market,” the DMO said.

    It was also added that “investor preference   was   mainly   for   the   10-year   bond,   which   had   a subscription level of 299 per cent.”

    In accordance with its policy of keeping the government’s borrowing costs at prudent levels, “the DMO allotted a total of N116.98 billion to successful bidders”.

  • September 2018 FGN bond auction oversubscribed by N158b

    The Federal Government of Nigeria Bond Auction for September 2018, conducted by the Debt Management Office (DMO) yesterday, was oversubscribed.

    A statement from the DMO said it received subscriptions from bidders for three Bonds offered: 5-year, 7-year and 10-year in excess of N158 billion, against the N90 billion offered.

    The DMO noted that the “demand at the Auction was concentrated on the 10-year bond which was 313 per cent subscribed.”

    At the end of the bidding exercise, “allotments were made to successful bidders at 15.00% for the 5-year, 15.15 per cent for the 7-year and 15.2459 per cent for the 10-year Bond, which are consistent with the rates in the secondary market for the Bonds offered at the Auction.”

    The statement added that as in the past, “a total of N96.74 billion was allotted to bidders at the Auction and the proceeds will provide additional financing for the implementation of the 2018 Appropriation Act.”

  • FGN April bonds oversubscribed by 292%

    The Federal Government of Nigeria (FGN) April 2018 Bond issued to raise funds to implement the 2018 budget was oversubscribed.

    A statement from the Debt Management Office (DMO) said the bond was oversubscribed by 292 per cent.

    “Three bonds (5, 7 and 10 years) were offered for a total amount of N90.00 billion. Total subscription was N262.48 billion, a subscription rate of 292 per cent. Each of the bonds was oversubscribed, with demand for the 10-year bond particularly strong at a rate of 534 per cent,” the statement read.

    The DMO said it conducted the fourth in the series of FGN Bond Auctions for 2018 on April 25, to raise funds for the implementation of the 2018 Budget. “A total of N90.00 billion was allotted at 12.75 per cent for the five-year bond, 12.85 per cent for the 7-year bond and 12.89 per cent for the 10-year bond,” DMO said, adding that “interest rates at the auction continued to trend downwards, as was the case at the March 2018 auction, and the rates for all the bonds offered at the April Auction were below 13 per cent.”

    The drop in rates “is consistent with the DMO’s expectations, based on its redemption of Nigerian Treasury Bills, which started in December 2017.”

    The funds injected into the market through the redemptions, and the lower interest rates, are supposed to make credit available to private sector borrowers at lower rates.

     

    This should enable them to lower their cost of operations and be more competitive in pricing.

  • Morison Industries’ N502.2m rights issue oversubscribed

    Morison Industries Plc has raised N502.2 million new equity funds, providing the 63-year-old healthcare company with the much-needed boost to reposition its operations.

    Morison Industries late last year floated a new capital raising for about N502.2 million in new equity funds through new share sale to existing shareholders. It offered a rights issue of 836.98 million ordinary shares of 50 Kobo each at 60 Kobo per share on the basis of 11 new ordinary shares for every two ordinary shares of 50 Kobo held as at August 25, 2017.

    GTI Securities Limited acted as the stockbroker to the supplementary share issuance while GTI Capital Limited was the issuing house. Both  are members of the GTI Group-a leading financial services group that owns the largest private trading floor in Sub Saharan Africa (SSA).

    The allotment results for the rights issue approved by the Securities and Exchange Commission (SEC) showed that the rights issue was oversubscribed by 1.12 million ordinary shares as shareholders took up their rights and demanded for additional shares. As against 836.98 million shares placed on offer, shareholders placed orders for 838.11 million ordinary shares.

    GTI Capital Chief Operating Officer, Mr. Kehinde Hassan, said the success of the rights issue has further confirmed GTI Capital’s pedigree of packaging companies to raise capital, irrespective of the macroeconomic and market conditions.

    According to him, GTI Capital worked with the directors and management of Morison Industries to convince shareholders on the prospects of the 63 year old healthcare company.

    “We were able to get many shareholders to subscribe to the shares due to our extensive research on the prospects of the company. Many subscribers were also impressed by the fact that all offers that we had handled in the past usually turned into goldmines, and the facts are out there. So the trust in GTI Capital positively rubs off on the exciting prospects of a recapitalised Morison Industries,” Hassan said.

    He reiterated the commitment of GTI Capital Group to supporting the growth of indigenous economy by providing amenable debt and equity capital and other advisory services to Nigerian companies.

    He pointed out that with its international presence; GTI Capital Group is well-positioned to handle private and public fund raisings for companies in Nigeria and beyond.

    Managing Director, Morison Industries Plc, Mr. Nwabueze Oputa, said the new equity funds would be deployed to improve working capital and finance the restructuring of the company.

    He noted that with the new equity funds, shareholders can be well assured of a new era of growth for Morison Industries adding that the directors of the company will work with all stakeholders to achieve its growth targets.

    Oputa commended the professionalism of GTI Capital in concluding the rights issue successfully and as scheduled, pointing out that GTI Capital has reinforced his confidence in the capabilities of Nigerian capital market operators.

    Morison Industries was incorporated in Nigeria in June 1955. Morison Industries is engaged in the production and marketing of pharmaceuticals, hygiene products and the importation and distribution of medical, surgical and hospital equipment, instruments and consumables. The company also provides its production facilities to third party for contract manufacturing arrangements.

  • Osun N22b bond oversubscribed by 100 per cent

    The Nigerian Capital Market during the week recorded an unprecedented feat as the Osun State’s N22 billion bond offer was oversubscribed by more than 100 per cent.

    Governor Rauf Aregbesola announced this in Osogbo, the state capital, at the completion ceremony between the state government and the Joint Issuing Houses for a N30 billion – 14.75 per cent fixed rate development bond (tranche 1) due in 2019.

    Aregbesola, who was represented by the Commissioner for Finance, Dr. Wale Bolorunduro, said the state went to the Capital Market to raise N22 billion, but raised N45.1 billion, which translates to more than a N100 per cent oversubscription.

    He said the N22 billion bond received 78 entries, an unparalleled record in capital market transactions.

    Over 60 per cent of the subscription was cornered by the Pension Fund Administrators.

    This is a departure from the past, in which offerings were dominated by the banks.

    The governor said this development validates the level of confidence long-term fund investors have in his administration.

    He said the administration’s prudence was responsible for the confidence investors had in it.

    Aregbesola described the tranasaction as “a landmark bond”.

    He said for the first time, the state’s bond rating was A and A-. Since Osun’s creation in 1991, it had no account, but within 24 months of the Aregbesola administration, a standard accounting record was put in place, which Augusto Rating Agency recently rated A-.

    The governor attributed all these successes to accountability, transparency and prudence, saying they would have been impossible some years back.

    He said his administration met an insolvent state, which could not even meet its statutory obligations, adding that his administration had to source N1 billion to meet its obligations.

    Aregbesola said: “When we began this, it was as if we were going on an impossible journey. This was because we met an insolvent state, which had to pay over N1 billion to meet its statutory obligations.

    “The sheer impossibility of this was what informed the misreading or the hallucination of the opposition in citing all sorts of figures. First, they said we were taking N200 billion. Later they said N150 billion. The last figure they quoted was N7.5 billion.

    “They just wanted to attack without having the correct information. I am happy that we are confounding them and we shall continue to confound them.

    “This state, since its inception, had no account. It is amazing that an administration that is just 24 months old developed an account that Agusto and Co. and other rating agencies rated A and A-.

    “We must congratulate ourselves for such a sudden flight, which attracted the highest corporate and financial affection as we now get at the Capital Market.

    “I urge our traducers, who would always want to see evil in us and profit from it, to think twice that this collection of the best in the Nigerian financial industry cannot be here for the fun of it.”

    He said it was an uphill task taking a state from zero or sub-zero level to an enviable height, where the Capital Market and the Nigerian Security and Exchange Commission could vouch for it.

    The governor thanked the House of Assembly for its “rare” support in ensuring the success of the bond issue.

    He thanked the people of the state for their support for his administration.

    Speaking on behalf of the Joint Issuing Houses, Mr. Taiwo Okeowo said the success of the bond issue was a recognition of the achievements of the Aregbesola administration.

    Describing the transaction as a breakthrough, Okeowo said: “With what is happening now, the governor is taking the state to an unimaginable height with the bond of development.”