Economy Update : Afreximbank Beats Private Placement Target

Obinna Chima

The African Export-Import Bank (Afreximbank) said it is off to a successful listing of its depositary receipts (DRs) on the official market of the Stock Exchange of Mauritius (SEM) following the close of the private placement with subscription far in excess of the $100 million minimum target.

The first day of listing and trading of the Afreximbank DRs would be October 4, when 5,000 DRs must, by regulation, be made available for trading at a price of $4.30 per DR.
The private placement closed on September 26.

The SEM had announced approval of the proposed listing on the official market of up to 69,770,000 depositary receipts backed by 6,977 Class D shares of Afreximbank, subject to Afreximbank raising the minimum aggregate amount of $100 million through the private placement. The approval was for Afreximbank to list the full 69, 770,000 within 12 months.

In pursuance of the DR issuance, Afreximbank organised investor meetings and roadshows in Port Louis, Lagos, Abu Dhabi, Dubai, Nairobi, New York, and London, drawing very positive responses from the investor public. Afreximbank goal was to achieve a subscription level between the required aggregate minimum of $100 million and an upper limit of $300 million notwithstanding the 12 month window allowed.

Reacting to the conclusion of the private placement, Afreximbank President Dr. Benedict Oramah said he was impressed with the high level of support received from investors and noted that the DRs would enhance the Bank’s capitalisation, enabling it contribute more significantly to narrowing the trade financing gap in Africa and to growing intra-African trade and export manufacturing in Africa.

He added that it would pave the way for greater private sector equity participation in the Bank and for deepening Africa’s capital markets.

“We are pleased to have successfully opened the Bank to the equity capital markets,” Oramah added.
“This will complement the tremendous support Afreximbank continues to receive from its core sovereign shareholders and place the Bank in a stronger position to pursue the vast opportunities before it,” he said.