By Nkiruka Nnorom
FORTE Oil Plc has raised its N9 billion from the capital market to support its operation and drive its expansion strategy. The bond is a 5 year fixed rate issue and the first series of its proposed N50 billion bond issuance programme.
According to the company, the funds raised would be deployed to refinance existing short term commercial bank loan obligations and to finance its retail outlet expansion. The company has an Issuer rating of A- long term and A1- short term rating by the Global Credit Rating Company (GCR).
Speaking at the Completion Board meeting in Lagos, the Group Chief Executive Officer, Mr. Akin Akinfemiwa, said: “The raising of this initial capital which has been fully underwritten shows the confidence the investing public has in Forte Oil Plc as an investment of choice. This bond programme being the first in the downstream sector, is testament to Forte Oil’s position within the downstream sector and allows the company to actualise the vision of the Board to continue to provide value to its shareholders regardless of the economic climate.”
Mr Julius Omodayo-Owotuga CFA, Group Executive Director, Finance and Risk, Forte Oil Plc, said: “this series provides us with the necessary liquidity to actualize our growth strategies and positions the company for the years ahead. The pricing of this debt instrument demonstrates the markets’ belief in us and the pricing would help reduce our borrowing cost and increase profitability in the short and long term.”
The bonds will be listed on the Nigerian Stock Exchange (NSE) and FMDQ OTC Exchange until maturity date in 2021. United Capital Limited served as the lead Financial Advisor/Issuing House to the transaction while Boston Advisory Limited, FBN Capital Limited, Planet Capital Limited and Vetiva Capital Management Limited served as joint Financial Advisors/issuing House.