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AMCON to list N1.7tn zero coupon bond today

By on April 21, 2011

The Asset Management Corporation of Nigeria will today list 1.7 billion zero coupon bond 2013 Series 1 at the Nigerian Stock Exchange.

According to a statement from the NSE, the 1.7 billion zero coupon bond will be listed at N1,000 per share.

AMCON recently completed a N1.7tn ($11bn) bond issue which attracted yields significantly below equivalent government treasuries.

The three-year zero-coupon bond was issued in three tranches. The first N1.15tn tranche, which attracted a 10.125 per cent yield, was issued to be exchanged for AMCON consideration bonds. It was launched in December to absorb non-performing loans from 21 Nigerian banks.

The second N20.7bn tranche was issued via a book building which opened recently and was oversubscribed, while the third N535bn tranche was issued to acquire additional non-performing loans from 22 lenders. Both tranches were priced with an 11.8 per cent yield.

The Managing Director, AMCON, Mr. Mustafa Chike-Obi, had said in an interview with CNBC Africa Television, “We are very happy with the 11.8 per cent yield. We were two times oversubscribed but we cut off the subscription at 11.8 per cent because we felt that was a good yield. As of today, equivalent Federal Government three-year treasuries are trading at a yield of 12.25 per cent, so effectively we are about 40-basis points tighter than equivalent (treasuries).”

Source : Punch