The ₦30 Billion 7-year fixed rate senior infrastructure Bonds issued by the LFZC Funding SPV PLC’s Series 1, a special purpose vehicle, or funding vehicle incorporated by Lagos Free Zone Company, under its ₦100 Billion Bond Issuance Programme is scheduled to close today Wednesday, August 27, 2025.
The SPV was set up to enable the LFZC, the licensee and operator of the Lagos Free Zone – the first privately owned economic zone in Nigeria, access funding from the domestic capital markets.
Proceeds of the bond issuance will be utilised to refinance existing credit facilities obtained by Lagos Free Zone Company, a key player in Nigeria’s economic development, which currently enjoys Bbb rating by Agusto & Co, as well as BBB rating by DataPro. Part of the proceeds will also be invested in the zone’s capital expenditure, as well as funding a Debt Service Reserve Account.
The bond also has book building price guidance of between 19.2% and 19.5%, while the coupon basis is fixed rate and semi-annual. Principal repayment is to be amortized by equal debt service payment semi-annually each year from 42 months after the issue date and following a 36-month moratorium, according to the office documents provided by Arthur Steven Asset Management Limited in a notice to clients.
Bond holders have the liberty to call it wholly or in part after two years from the issue date and thereafter on each payment date up to and including the maturity date. While a call between year 3 and 4 will attract a price of 101% of par value, years 5 and 6 will be at 100.5% of par value, while year 7 is 100% of par value.
The bond will be listed simultaneously on the Nigerian Exchange Limited and the FMDQ Securities Exchange Limited.
The 860-hectare Lagos Free Zone site, according to the issuers, is integrated with the Lekki Deep Seaport, promoted by the Singapore-based Tolaram Group, being developed as a “Live-Work-Play” community and equipped with built-up standard industrial and warehouse facilities.
As Of December 2024, about 30 registered enterprises including some notable international brands have an operational base in the Lagos Free Zone. The Lekki Deep Seaport construction was completed in October 2022, was commissioned by former President Muhammadu Buhari on 23 January 2023, and that same month, the first commercial vessel berthed.
The Company’s current activities involve the development of a business model and a vision plan for the zone, land development, construction of buildings and infrastructure, operating the Free Trade Zone and leasing the developed land to enterprises registered within the Zone.
The company has established a strong track record of issuance in the debt capital markets and continues to garner support given its pivotal role to enhance industrial, port and business operations in the country.
In January 2025, the International Finance Corporation (IFC) announced an equity investment of up to US$50 million investment in LFZ, marking a significant milestone designed to address critical infrastructure gaps, attract local and global businesses, and contribute to Nigeria’s economic diversification agenda.
