Paras Energy Funding SPV Plc has secured a listing for a N15 billion ($10.3 million) five-year bond on the FMDQ Securities Exchange, marking a notable capital raise for the Nigerian power sector.
The instrument, carrying an 18% fixed annual coupon, was approved and listed on the platform, providing the firm with a direct channel to institutional investors seeking yield in the local currency debt market.
While the listing provides Paras Energy with necessary liquidity for operations or expansion, the 18% yield reflects the risk premium investors demand for exposure to the domestic power sector.
The high coupon rate underscores the persistent cost of capital for energy infrastructure developers in Nigeria, where inflation and currency volatility continue to pressure borrowing costs.
While the listing provides Paras Energy with necessary liquidity for operations or expansion, the 18% yield reflects the risk premium investors demand for exposure to the domestic power sector.
This move comes as the Federal Government of Nigeria pursues a broader strategy to restructure liabilities within the power sector, having recently launched a N729 billion bond issuance aimed at completing the debt reduction phase.
The listing adds to the activity in Nigeria’s energy finance space, following recent reports from Nigerian Petroleum Products Marketing Company (NIPCO) on its full-year turnover and strategic shift toward gas infrastructure.