June 16, 2009

Ogun State set to raise N60bn Bond

By Peter Egwuatu & Michael Eboh
n an apparent bid to meet     its long term developmental goals, the Ogun State government is set to raise not less than N50 billion from the nation’s capital market, even as it refutes allegations from some members of the State House of Assembly that the state has no financial statement

Gbenga Daniel

Gbenga Daniel

The Executive Governor of Ogun State, Otunba Gbenga Daniel , yesterday at the Lagos floor of the Nigerian Stock Exchange (NSE)  told the capital market community that his administration having met the short and medium term objectives now wish to meet its long term objectives.

However, he did not mention the actual amount to be raised, but information gathered from sources close to the governor reveals that the amount may not be less than N50 billion

According to him, “ It is not true that Ogun State government has no account. We have a five year financial statement that we did publish and send to the State House of Assembly. How come some people are saying we don’t have account. We have a five year  financial statement that we are presenting to the capital market regulators to enable us get approval after putting in place all other things  required.

We are going to use the proceeds from this bond to provide basic infrastructure which we have already started. We have started building good roads and street lights , providing pipe borne water, building tourist attraction like Olumo Rock. We have started building airport and also intend to build deep sea port. These are capital intensive and long term projects that requires to be financed through Bond.

Governor Daniel disclosed that the State has so many educated people with different interests and ideologies. “ We are set to overcome the oppositions we are getting from any quarter. All the negative statements we are reading from the newspapers and not true. I challenge the media to do investigative journalism to get the real facts. Many of these statements are political in nature and we would address them. So the media should not border about the statement from the House of Assembly.

We are determined to raise bond to develop the State because if we don’t do any thing to change the face of our people posterity will not forgive us. I have been an activist since my day in the University of Lagos protesting against the governance of this country. Now that I am there I have seen the challenges facing government and would do every thing to put a legacy behind.

I have integrity to protect. Though I have two years to go but we have to start the long term projects and since there is continuity in governance every project that we have started and cannot finish would be completed by successive government”he noted.

He said, “ There is no deep sea port in Nigerian and in the West Coast of Africa.. So building a deep sea port have a lot of advantages for the State and the country in general.. With deep sea port we would be able to get big ships to berth in our country. There will be no need for ships carrying Nigerian goods from Europe or America to tranship to other ports before getting to Nigeria. We would begin to have direct transportation of our goods from Europe or America to Nigeria.. The issue of congestion of the Tincan Island and Apapa Wharf will be reduced drastically. The cost of transportation  and duration of ship landing in Nigeria would be reduced.”

On the aspect of building roads, he said, “ It is capital intensive. Our country do not produce bitumen and we have to import them. So we intend to build many roads across the State. The money we are about to raise through  Bond will be used to touch all the nooks and crannies of the State in one way or the other. We are planing to have joint corporation with our neighbouring States like, Ondo, Edo and Delta where there are some deposit of bitumen to see how we can explore it.

We are partnering with Lagos to have free flow of traffic. We are part of the Mega Lagos City project. The airport we are building is going to have railway track to Lagos. The modern railway track that the Lagos State plans to build would be connected to Ogun State. Most of the water that Lagos is consuming is being supplied by Ogun State.

While welcoming the Ogun State Governor and his economic team on the Lagos  floor of the Exchange, the President of the NSE, Dr. Oba Otudeko said, “ There is no doubt that the capital market is the pivot through which  long term developmental project could be financed.”

According to him, “ 18 applications have been received from different governments and institutions to raise money.  For instance the Lagos State is raising N275 billion Bonds as already N50 billion had been issued for the first tranche which was oversubscribed. Kano State has applied for N17 billion, Imo State N18.8 billion, Niger State N6 billion and so forth and on.”

Speaking, he said “ I want to thank God that my prediction in January that our market will rebound is beginning to manifest. We will continue to see up and up market because the fundamentals are there. I want to encourage other States government to take opportunities in the market to meet their long term developmental goals.

He commended Governor Daniel for the speedy transformation of the State and promised that the Exchange will give him the necessary support.