Forte Oil To Borrow N9 billion Via Bonds

Nigeria’s oil and gas firm, Forte Oil Plc has finalized plans to raise about N9 billion via corporate bonds. According to information contained in the prospectus obtained by Nairametrics, the company is looking to raise N9 billion for a 5 year tenor and at a coupon of 5 years FGN plus 2%. The bond offering is the first series of a N50 billion bond issuance programme.

The information in the prospectus also reveals that the bond is unsecured but fully underwritten by the following parties;

Boston Advisory Limited – N850,000,000

Planet Capital Limited – N1,000,000,000

United Capital Plc – N6,150,000,000

Vetiva Capital Management Limited – N500,000,000

FBN Capital Limited – N500,000,000

Utilization

Forte Oil reveals in the prospectus that it plans to use the funds to ;

1. Refinance existing commercial bank loan obligations 6,003,261,999 (70.00% of the funds)
2. and to  Immediately finance the Company’s retail outlet expansion strategy 2,572,826,571 (30.00% of the funds)

Forte Oil currently has about N44 billion in external debts. N11 billion of the loans was used to acquire Geregu Power plant while another N25 billion are short term loans used for petroleum products importation.