FG collaborates GuarantCo on ₦10 billionn infrastructural bond

More avenues to tackle the nation’s epileptic power supply were unveiled yesterday as InfraCredit, a top-rated infrastructure credit enhancement facility, established by the Nigeria Sovereign Investment Authority (NSIA) in collaboration with GuarantCo (a private infrastructure development group company), announced its inaugural 10-year guaranteed infrastructure bond in the Nigerian debt capital markets.

The Chief Executive Officer of InfraCredit, Chinua Azubike, who disclosed this in a statement said a special purpose vehicle (Viathan Funding Plc) had since been established to raise debt capital.

He added that Viathan had successfully accessed the debt capital markets for the first time by issuing a ₦10 billion 16 per cent Series 1 Senior Guaranteed Fixed Rate Bond due 2027 (the Viathan Bonds) backed by the irrevocable and unconditional guarantee of InfraCredit and accorded ‘AAA’ long term national scale rating by GCR and Agusto & Co,” he explained.

Azubuike added that Viathan Group develops and operates captive and embedded (off-grid) power solutions for governmental, commercial and residential off-takers across Nigeria, using natural gas as fuel with a combined generation capacity of 50 megawatts.

“Nigeria’s aggregate electricity need has been estimated at about 160,000MW to satisfy the local electricity demand. With an installed capacity of 12,132mw, only an estimated 7,000mw of installed capacity is operational. Of these, only between 3,000mw and 5,000mw are actually being generated due to unavailability of gas, breakdowns, water shortage and grid constraints, which have led to acute shortage of power across the country. Nigeria’s transmission grid is estimated to cover a maximum 40 per cent of the country, with annual self-generating capacity outside the national grid put at over 15,000mw.

“The net proceeds of the bonds will be utilised by Viathan Group to expand its generation capacity by 7.5mw, construct a 104,800 scm/day Compressed Natural Gas (CNG) plant and refinance short term bank debt,” he said.