Investors reassured of attractive ROI in Cleaner Lagos Initiative N50bn Project Bond


Investors willing to invest in the N50bn Project Medium Term Notes being issued to finance of the Cleaner Lagos Initiative (CLI), which is backed by the Lagos State Government, have been reassured of an attractive Return on Investment (ROI), as the State has outlined its strategy to fund and deliver an effective waste management service.

At the CLI Investors’ Roundtable which held on Thursday, August 10, 2017, potential investors were presented with the innovative financing structure; of which the first tranche of the N27bn is being issued to fund and operate the Cleaner Lagos initiative which commences in September. The first tranche, which has a 5-year tenure and 17.5% coupon, will be open to qualified investors from August 14 for a two week period.

Lagos State Commissioner for Environment, Dr. Adejare Babatunde Samuel, in his opening remarks at the Investors Roundtable said the partnership with the private sector was essential in achieving a long-term financing of waste management in Lagos.

He said the Cleaner Lagos Initiative is public-private sector driven because the state government understands the value which public-private partnership plays in driving the economy and achieving maximum results in crucial projects. According to him, Visionscape, a leading global environmental utility group, has been engaged to operationalize the CLI and provide the required infrastructure for environmental waste management services in the state.

Those present at the CLI Investors’ Roundtable included the Perm. Secretary, Lagos State Ministry of Environment, Mr. Abiodun Bamigboye; Chief Operations Officer, Visionscape, Thomas Forgacs; MD, SWM Solutions, Special Adviser to the Lagos State Governor on Environment, Mr. Babatunde Hunpe including executives from banks, investment firms and pension funds administrators.

Speaking further on the Medium Term Notes, Executive Director, Eczellon Capital, Dipo Wintoki, said the Bond offers investors opportunity to take part in the transformation of Lagos State.

According to him, “This particular instrument is not the typical investment. This is what we call an impact investment – it is a sustainable environmental and social impact investment. So, for every kobo that every investor puts into this instrument to fund the CLI, the investor is touching someone’s life.

“This is a guaranteed and secured investment. It is guaranteed by Irrevocable standing Payment Order (ISPO) of Lagos State. Lagos State prides itself as an A+ rated state which is the highest rating received by any state government in Nigeria. The instrument is a corporate bond being issued by a private funding SPV and backed by the State’s ISPO,” Wintoki said.

The CLI is aimed at ensuring effective waste collection and disposal in the state through the improvement of the existing process using the generated funds, and enforcement of the new environmental law passed on March 1, 2017 by the State House of Assembly. It is projected that CLI will generate over 27,500 new jobs in Lagos state.


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