LAGOS, Nigeria, January 15, 2025 – Africa Finance Corporation (AFC), a leading provider of infrastructure solutions across Africa, has successfully priced its inaugural US$500 million perpetual hybrid bond. The landmark issuance has received strong investor interest, with demand peaking at US$1.1 billion in orders, resulting in 1.5 times oversubscription. This debut hybrid bond highlights AFC’s growing influence in global capital markets and its commitment to financing transformative infrastructure projects across the continent.
The bond, priced at a coupon rate of 7.50%, has no fixed maturity. It represents a unique blend of equity and debt, offering 100% equity credit recognition from Moody’s Investor Services. The bond’s structure provides AFC with enhanced financial flexibility, allowing it to strengthen its balance sheet while continuing to support long-term growth. The issuance will offer investors stability during the initial non-callable period of 5.25 years, after which AFC will manage the bond in alignment with its financial strategy.
“This inaugural hybrid bond issuance is a testament to our commitment to advancing bold infrastructure projects that are vital for Africa’s growth and sustainable development,” said Samaila Zubairu, President & CEO of AFC. “Despite tightening financial conditions globally, we are mobilizing international capital to support Africa’s industrialization, integration, and economic transformation.”
Banji Fehintola, Executive Board Member and Head of Financial Services at AFC, also celebrated the achievement, noting that the hybrid bond demonstrates global investors’ confidence in AFC’s ability to deliver impactful infrastructure solutions. “This issuance strengthens our equity base, diversifies our funding sources, and positions AFC to accelerate Africa’s industrialization and economic transformation,” Fehintola added.
AFC’s hybrid bond issuance sets a new benchmark for African institutions seeking to diversify funding sources. It builds upon AFC’s expertise in structuring complex financial instruments that attract global investors and unlock new capital markets for the continent. In 2023, AFC secured a US$1.16 billion syndicated loan, its largest international transaction to date, and welcomed Turk Eximbank as its first non-African equity investor, further demonstrating the corporation’s growing global influence.
Proceeds from the bond issuance will strengthen AFC’s capital position and support its ongoing infrastructure initiatives, including the Lobito Corridor Rail Project, which connects resource-rich, landlocked countries to global markets; the Red Sea Power Project in Djibouti, which supports the country’s shift to renewable energy; and Arise Integrated Industrial Projects, aimed at reducing import dependency while creating high-value jobs.
The issuance of AFC’s hybrid bond marks a significant milestone for Africa’s infrastructure financing, paving the way for more innovative financial solutions that will continue to unlock global capital and accelerate Africa’s economic transformation. The corporation’s efforts are setting the stage for a more interconnected, sustainable, and economically resilient continent.
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