Ardova N25.3bn Bond Records 143% Subscription, Acquires Enyo Retail Outlets

Caption: From left, Mrs. Aniola Durosinmi – Etti Independent Non-Executive Director, Ardova Plc; Chuka Eseka – Chief Executive Officer, Vetiva Capital Management Limited; Olumide Adeosun – Chief Executive Officer, Ardova Plc; Moshood Olajide Chief Financial Officer, Ardova Plc; Eric Fajemisin – Executive Director, Corporate And Transactional Banking Stanbic IBTC Bank; and Olusola Adeeyo Independent Non-Executive Director, Ardova Plc at the signing ceremony for the Ardova Plc N25.3bn series 1 Bond issuance recently held in Lagos.

Petroleum products marketing giant listed on the Nigerian Exchange- Ardova Plc, on Wednesday announced the successful completion of a N25.3bn Series 1 (Tranche A and Tranche B) Fixed Rate Senior Unsecured Bond Issue, the largest local currency bond issuance by an indigenous oil and gas company in the history of the Nigerian debt capital markets, under its N60bn Debt Issuance Programme.

The Bond Issue, proceeds of which will be used to fund expansion projects and working capital requirements, attracted participation from a diverse range of institutional investors including pension funds and asset managers, supported by an ‘A’ rating from DataPro and an ‘A-‘ rating from GCR, was 143% subscribed, and comprised 7-year Tranche A and 10-year Tranche B bonds.

While the 7-year Tranche A bonds are priced at 13.30%, the 10-year Tranche B bonds are priced at 13.65%.

The strong level of oversubscription, the company said in a statement, “demonstrated investor confidence in Ardova’s niche position as a leading indigenous integrated energy company, its strong management team, business strategy, and credit profile.”

Vetiva Capital Management Limited and Stanbic IBTC Capital Limited acted as Lead Issuing House and Joint Issuing House respectively to the Bond Issue. Other professional parties include Banwo&Ighodalo and Aluko & Oyebode who acted as Solicitors to the Issue and Solicitors to the Trustees respectively and PricewaterhouseCoopers who acted as Reporting Accountants.

Commenting on the landmark issuance, Olumide Adeosun, Chief Executive Officer of Ardova, expressed delight at the overwhelming success of the Bond Issue and appreciated “the Issuing Houses and other professional parties for working tirelessly to ensure the timely and successful completion of the Bond Issue.”

Adeosun also added: “We are humbled by the warm reception of our Series 1 (Tranche A and Tranche B) Bonds Issue by Nigeria’s ever-growing institutional investor community. The 7-year and 10-year tranches provide Ardova with the much-needed flexibility to expand and diversify our operations as well as increase our footprint across the country.

“Our relationship with Nigeria’s debt capital markets commenced in December 2016 with the issuance of the company’s debut bonds. This landmark transaction evidences our commitment to nurturing this relationship and adopting the debt capital markets as a fundamental part of our funding strategy on our journey towards being the largest supplier of energy in Nigeria,” he added.

Chuka Eseka, Managing Director/Chief Executive Officer of Vetiva Capital Management Limited, speaking on the bond issuance expressed delight at the opportunity to provide “Ardova with full-scope advisory and issuing house services on the Issue.

“The success of the transaction demonstrates investors’ confidence in the management, vision, and purpose of the Ardova team and we thank the Board and management of Ardova for giving Vetiva the opportunity to lead on this landmark transaction. We are very proud to be associated with Ardova and look forward to extending our advisory capabilities to the Company on its other strategic initiatives,” he added.

Also commenting, Funso Akere, Chief Executive of Stanbic IBTC Capital, equally noted with delight the advisory role offered to “Ardova on its successful return to the Nigerian debt capital markets. We thank the institutional investor community for supporting the Bond Issue, as its success should encourage other similar companies to access the domestic debt capital markets for their strategic funding needs. We also thank the Board and management of Ardova for giving the Issuing Houses a free hand to guide the process and look forward to working closely with Ardova on subsequent issuances under its ₦60bn Debt Issuance Programme.”

An application, according to a statement to the Nigerian Exchange by Oladeinde Nelson-Cole, the Company Secretary/General Counsel, will be made to list the bonds on the FMDQ Securities Exchange Limited.

Professional advisers to the issuance were listed as Vetiva Capital Management Limited and Stanbic IBTC Capital Limited acted as Joint Issuing Houses, Banwo & Ighodalo acted as Transaction Counsel, whilst trustees were advised by Aluko & Oyebode.

Also on Wednesday, the company announced the completion of its acquisition of a 100% equity stake in Enyo Retail and Supply Limited, a fast-growing technology-driven fuel retailing company in Nigeria with offices in Lagos and five other states, through a wholly-owned subsidiary of the company- Bags and Kegs Limited.

This, Ardova said is further to its announcement of June 14, 2021, wherein it notified the Nigerian Exchange Limited, its shareholders, and the investing public of the execution of a share purchase agreement to acquire 100% equity stake in Enyo.

Consequently, the statement announced that from Wednesday, November 14, “Enyo is now a wholly-owned subsidiary of the company, leading to stronger downstream energy group that benefits from the increased customer reach and service delivery.

This is further expected to produce stronger financial results for the company, for the benefit of stakeholders, including the shareholders and government by way of tax.

“Company is pleased to announce that the Transaction has been completed and all conditions have been satisfied,” the statement noted, adding that the acquisition was completed Stanbic IBTC Capital Limited and Banwo & Ighodalo advised Ardova while Rand Merchant Bank and Herbert Smith Freehills Paris LLP acted as financial and legal advisers respectively to Enyo.