Governor Babajide Sanwo-Olu, on Monday, presided over the ceremony where necessary documents required by the Securities and Exchange Commission, SEC, to facilitate the issuance of 13 per cent fixed rate bond were signed by the State’s Attorney General, issuing parties and trustees of the funds.

The event marked the third time Lagos government would be issuing a long-tenure bond of 10 years (2021-2031), bringing to a total value of N377.715 billion bond issued from the Lagos State’s Series IV N500 Billion Debt Issuance Programme.

The State set out to raise N125 billion from the capital market but closed the bids with N137.3 billion, following oversubscription.

The development, Sanwo-Olu said, demonstrated a “strong response” from the investing community and testified to confidence of investors in the state’s ability to deliver on its infrastructural and socio-economic developmental objectives, while meeting repayment obligations.

The governor said proceeds from the bond would be used to finance key infrastructure projects in healthcare, environment and road construction, including the 10-km Regional Road in Eti Osa, six-lane Lekki-Epe Expressway, Ijeododo Road in Alimosho and Oba Sekumade Road in Ikorodu, among others.

Sanwo-Olu said the iconic projects for which the funds would be earmarked would contribute to a better quality of living for the residents, while also creating a more enabling environment for commercial and economic activities.

He said: “Lagos once again marks another milestone in the domestic debt capital markets, with the issuance of the largest bond ever by a sub-national government in Nigeria. The signing ceremony finalises the issuance of N137.3 billion bond at 13 per cent fixed rate in our Series IV Bond Issuance under the N500 Billion Fourth Debt Issuance Programme.

“We set out to raise up to N125 billion, but we closed the book with bids totalling N137.3 billion. This is a strong response from the investing community to our administration’s debut bond issuance. This humbling achievement is a testament to continued investors’ confidence in the state’s ability to deliver on its infrastructural and socio-economic developmental objectives, and also to meet repayment obligations.

“In line with our vision to build a Greater Lagos, proceeds from this bond will be used to finance infrastructure projects, primarily in roads, environment and healthcare. These projects include 10-km Regional Road in Eti Osa, six-lane Lekki-Epe Expressway, Ijeododo Road in Alimosho and Oba Sekumade Road in Ikorodu. These will contribute to a better quality of living for our people, while also creating a more enabling environment for commercial and economic activity.”

Sanwo-Olu said  the multiplier effects in socio-economic activities felt from the previous intervention capital raised justified the cost of investment in critical sectors.

He said Lagos had maintained high discipline on the size and pricing of its bonds, noting that the state got the clearance to proceed with the issuance as its coupon of 13 per cent yearly fell within the acceptable clearing bid.

The governor disclosed that the issuance process started in April based on the advice of the state’s transaction advisers.

With the issuance of the third bond, Sanwo-Olu said the imperative to aggressively drive his administration’s THEMES agenda had been boosted, pledging to deliver more iconic projects that would raise the value of the state’s economy.

The governor applauded the Federal Ministry of Finance, SEC, National Pension Commission, PENCOM, and Debt Management Office for supporting the state’s infrastructure drive.

Commissioner for Finance, Dr. Rabiu Olowo, gave summary of the bid book in respect to the bond, pointing out that 319 bids were submitted during the offer period, while total bids at N146.328 billion value were received.

Olowo said N137.328 billion qualified under the terms of the offer at the clearing price of 13 per cent per annum.

He said: “In April 2021, we accelerated an ongoing conversation on the need to quickly intervene on the huge infrastructure gap in the face of limited financial resources. We took advantage of the favourable investment climate in the capital market to initiate a bridge to finance transaction by redeeming and refinancing the existing bonds.

“It is fulfilling to note that despite the hurdles that were faced, we have been able to achieve the target we set for ourselves. In fact, we exceeded the target. Many thanks to Mr. Governor for his timely intervention at different phases. This is undoubtedly another momentous transaction for Lagos.”

The State Attorney-General and Commissioner for Justice, Mr. Moyosore Onigbanjo, SAN, represented by the Permanent Secretary, Mrs. Titilayo Shitta-Bey, said members of the State Executive Council, in the December 20, 2021 meeting, approved the resolution of the government to issue the bond.

Representative of the 24 issuing parties and Managing Director of Chapel Hill Denham, Mrs. Kemi Awodein, described the bond as a “landmark transaction” and largest to be issued by a non-federal government entity.

She said all the issuing parties stood boldly behind the Lagos government to realise its development objectives for which the bond was facilitated.

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The News Agency of Nigeria (NAN) reports that the market capitalisation closed higher at N13.483 trillion compared with N13.458 trillion, an increase of 0.19 per cent.

Also, the NSE All-Share Index rose by 52.54 points or 0.19 to close at 27,698.69 from 27,646.15 achieved on Thursday.

Nestle led the gainers’ table, gaining N10 to close at N1,210.10 per share.

Stanbic IBTC followed with a gain of N2.90 to close at N42.85, while Nigerian Breweries gained 55k to close at N52.55 per share.

Dangote Sugar added 50k to close at N11.05, while Flour Mills advanced by 30k to close at N14 per share.

Conversely, Cadbury topped the losers’ chart, declining by 70k to close at N10.95 per share.

Zenith Bank trailed with a loss of 30k to close at N18.70, while Eterna dipped 25k to close at N2.75 per share.

Guaranty Trust Bank was down by 25k to close at N29, while Lafarge Africa also depreciated by 25k to close at N15.1 per share.

The volume of shares traded closed lower with an exchange of 177.57 million worth N5.92 billion achieved in 3,484 deals.

This was against a total of 245.44 million shares valued at N1.67 billion traded in 3,450 deals on Thursday.

Nigeria Breweries was the most active stock, exchanging 28.14 million shares worth N1.48 billion.

Guaranty Trust Bank followed with an account of 17.66 million shares worth N512.29 million, while FBN Holdings sold 15.96 million shares valued at N89.51 million.

United Bank for Africa sold 15.22 million shares worth N93.60 million, while Zenith Bank traded 14.55 million shares valued at N275.97 million.

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