Nigerian based fintech firm Interswitch completes N23bn bond placement

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Following the registration of a N30 billion debt issuance programme with the Securities and Exchange Commission of Nigeria (SEC), Interswitch Limited, a leading technology-driven company focused on the digitisation of payments in Nigeria and other African countries, has successfully concluded a N23 billion Series 1 Fixed Rate Senior Unsecured Callable Bonds issue, through a Special Purpose Vehicle (SPV), Interswitch Africa One PLC.

The Series 1 Issue priced at 15% was 2.6x subscribed. The 7-year Bonds, embedding a call option that can only be exercised from the second year, are payable in full at maturity. An application will be made to list the Bonds on the Nigerian Stock Exchange on receipt of the SEC’s approval of the proposed allotments.

Investor-participation was restricted to qualified institutional investors as defined by the SEC in Nigeria, with a proposed Bonds allocation of 64% to pension fund managers, 7% to asset managers and 22% to commercial banks pending SEC approval.

The strong level of over subscription demonstrated investor confidence in the Interswitch brand, business model and long-term strategy, supported by strong domestic ratings from both Agusto & Co. Limited (“Agusto”) and Moody’s Investor Service (“Moody’s”).

The Issuer was assigned “Aa3” national scale programme rating (stable) by Moody’s and “Aa” (stable) national scale rating by Agusto, on the back of positive secular industry shifts, a strong market position and a good liquidity profile. The Sponsor was also assigned “Aa” (stable) rating by Agusto.

The Founder and CEO, Mr Mitchell Elegbe, commented: “We are delighted to report the success of the first series of Bonds issued under our Programme, especially with the level of interest shown by investors. Diversifying our funding sources through the inclusion of these Bonds will enable us achieve our strategic objectives and vision.”

FBN Quest Merchant Bank and Stanbic IBTC Capital acted as Lead Financial Advisors/Issuing Houses and ABSA Capital Markets Nigeria, FCMB Capital Markets, Quantum Zenith Capital & Investments and Rand Merchant Bank Nigeria, as Joint Issuing Houses.

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Godwin Okafor is a Financial Journalist, Internet Social Entrepreneur and Founder of Naija247news Media Limited. He has over 16 years experience in financial journalism. His experience cuts across traditional and digital media. He started his journalism career at Business Day, Nigeria and founded Naija247news Media in 2010. Godwin holds a Bachelors degree in Industrial Relations and Personnel Management from the Lagos State University, Ojo, Lagos. He is an alumni of Lagos Business School and a Fellow of the University of Pennsylvania (Wharton Seminar for Business Journalists). Over the years, he has won a number of journalism awards. Godwin is the chairman of Emmerich Resources Limited, the publisher of Naija247news.

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