 |
|
|
|
|
|
 | Standard Bank helps fund socio-economic development in Nigeria |  |  |
 |
|
20 October 2008
Construction on the multi-million US Dollar Nigerian Lekki-Epe Expressway, West Africa's first toll road, is set to begin in earnest.
The public private partnership, between the Lagos state government and the Lekki Concession Company, will see the development of a toll road corridor along the Lekki peninsular. The 50km strip of land is a fast growing residential and commercial area to the east of Victoria Island.
The deal was finalised on Friday,17 October when the financial draw down took place. Standard Bank is co-financial advisor as well as an arranger and underwriter on the project.
Funding for the project, which should take three years to complete, comes from Lagos state, which has invested Naira (N)5 billion (about US$42 million) in a 20-year mezzanine tranche. The African Development Bank provided N10 billion (about US$85 million) senior debt over 15 years and local lenders, including First Bank of Nigeria and United Bank for Africa, provided a 12-year note facility of N9.4 billion (about US$80 million).
The remaining term funding was provided by Standard Bank Plc, which became the sole arranger of the N11 billion (about US$93 million) 15-year international tranche. This tranche was underwritten by Standard Bank Plc and Stanbic IBTC Bank, Standard Bank's local subsidiary in Nigeria.
"To source 15-year Naira in this climate is testament to a well structured and solid deal," said Mike Waller from Standard Bank Plc. "Standard was able to use both its offshore and onshore Naira risk management platforms to structure the long-dated cross currency swap, allowing dollar funded institutions to participate."
Jonathan Wood, Global Head, Project Finance at Standard Bank said that Lagos last saw major investment in infrastructure in the late 1970s.
"The past five years of economic reform and rising oil income have been extremely positive for Lagos, triggering a boom in commercial and residential property and real estate. On the downside, the city has been crippled with traffic congestion. This has necessitated the development of innovative projects such as the Lekki-Epe Expressway."
He said that the expressway had presented many challenges so getting it to financial closure was a major achievement in perseverance and creativity.
"The project had to navigate through five years of significant turbulence, including changes in Government at both State and Federal level, the fundamental reform of the local banking system, significant construction cost escalations and the global credit crisis of the past 12 months."
At the recent commissioning of the Lekki-Epe Expressway, the Lagos State governor Babatunde Fashola said that the new road would enable people to commute with greater speed, safety and comfort while boosting socio-economic activity in the state.
|
|
|
|
|
|
|
|
|
|
|
