Rating Release

Agusto & Co. hereby affirms the “A-” rating to the Axxela Funding 1 Plc’s ₦11.5 billion Bond with a stable outlook

The rating expires on 31-05-23

Agusto & Co. hereby affirms the “A-” rating to the Axxela Funding 1 Plc’s (“the Issuer” or “SPV”) ₦11.5 billion 7-Year 14.3% Fixed Rate Bond Due 2027 (“Series 1”, “Bond” or “Issue”) under the ₦50 Billion Bond Issuance Programme. The assigned Issue rating mirrors the standalone rating of the Sponsor (Axxela Limited ), as the Bond is senior, secured and ranks pari passu with other senior obligations of the Co-Obligors – Axxela Limited and Gaslink Nigeria Limited. The Series 1 Bond has a fixed coupon rate of 14.3% which is being paid semi-annually over the seven-year tenor of the Bond, while the principal will be repaid half-yearly, following the expiration of a two-year moratorium.

The repayment of the Series 1 Bond is premised on the irrevocable and unconditional undertaking of the Co-Obligors to jointly and severally repay the aggregate principal amount outstanding and coupon from their consolidated operating cash flow per the executed Master Notes Subscription Agreement. As at 31 May 2022, the Issuer had made four coupon payments amounting to ₦3.29 billion to the Series 1 Bondholders. The next coupon payment is due on 20 November 2022 and the semi-annual bond principal repayment will commence on the same date, following the expiration of the two-year moratorium.

The opinions expressed in this rating release do not represent investment or other advice and should therefore not be construed as such. Visit www.agusto.com for further information.