In line with President Tinubu’s administration’s plan to boost infrastructure funding in Africa’s largest economy, the Nigerian Exchange Limited on Friday listed N4.075 billion of AVA Infrastructure Series 1 Fund on its trading platform.
A sum total of N200 billion is expected to be raised by investors in the capital market for this purpose.
The Federal Government had hinted that Nigeria needs $25 billion yearly, up till 2040, to cover its infrastructure expenditure.
In a statement signed by the head, Issuers Regulation Department of NGX, Godstime Iwenekhai, the Nigerian bourse stated that “Trading license holders are hereby notified of the listing of AVA Global Asset Managers Limited’s AVA Infrastructure Series 1 Fund of 4,075 units of N1 million each issued at par under the N200 billion issuance programme.”
AVA Infrastructure Series 1 Fund’s 4,075 units were listed on the Main Board of NGX at N1 million each as a closed-end Fund and naira-denominated unit trust scheme.
AVA Capital Partners Limited is the Issuing House for the Fund, the Trustee to the Fund is STL Trustees Limited, Custodian of the Fund is United Bank of Africa Plc and the Registrar for the Fund is Cordros Registrars Limited.
Meanwhile, the Securities and Exchange Commission approved the N200 billion Infrastructure Fund of asset management firm, AVA Global Asset Managers Limited.
AVA Global Asset Managers recently launched its Series I issuance of the fund, sized at up to N200 billion on January 29, 2024 and closed on March 6, 2024, aimed at bolstering infrastructural development within the country.
“The fund aims to address Nigeria’s infrastructure gaps by strategically channeling institutional capital into infrastructure projects and is designed to encourage innovative businesses in sectors such as power, telecommunications, agribusiness and supporting infrastructure, gas distribution, processing, and storage.
“A sum total of N200 billion is expected to be raised by investors in the capital market for this purpose.”
“The fund’s main objective is to deliver consistent and reliable income to unit holders through debt financing for infrastructure projects in Nigeria. It seeks to focus on projects or businesses that offer vital economic and social services, exhibit stable cash flows, and utilise long-lived assets,” the Company said.
The Managing Director of AVA Global Asset Managers, Efe Shaire stated that the fund aimed to strategically allocate private credit with a focus on impactful projects with robust and predictable future cash flows.
He emphasized the importance of private sector involvement in infrastructure financing, stressing the necessity for collaborative efforts, innovative financial products, and other strategic initiatives from private sector entities.
The listing of the fund on NGX is a clear indication of the growing interest and demand for sustainable investing in Africa and the Exchange’s commitment to the same. NGX is committed to give visibility to sustainable financial instruments listed on its platform and to encourage more listings in the sustainable finance segment as part of its sustainability drive for the capital market.
“President Muhammadu Buhari, realising that the government could not meet this huge cost, established the Presidential Infrastructure Development Fund (PIDF), with the National Sovereign Wealth Authority, playing a vital role.
“In March 2024, President Bola Tinubu approved the Renewed Hope Infrastructure Development Fund to bridge the country’s $25bn per annum infrastructure funding gap.
“The new initiative will be domiciled in the Presidency,” the Minister of Information and National Orientation, Mohammed Idris, told journalists after Monday’s Federal Executive Council meeting at the Presidential Villa, Abuja.
Idris said the fund became necessary given Nigeria’s current infrastructure gap, requiring $878bn to bridge between 2016 and 2040.
“Now, there is a study that was made that said Nigeria will require about $878bn between 2016 and 2040 to bridge its infrastructural deficit.
“What that means is that from 2016 to 2040, about $25bn will be required annually to bridge that infrastructure deficit.
“Therefore, Mr. President, in his wisdom and with the approval of the Federal Executive Council, today, approved the setting up of the Renewed Hope Infrastructure Development Fund to be domiciled in the Presidency,” he announced.
Giving further details about the new development, the Chairman of the Federal Inland Revenue Service, Zacch Adedeji, said the fund would focus on road, rail, agriculture, ports and aviation.