The Federal Government has commenced the long-awaited process of repaying the ₦4 trillion debt owed to Power Generation Companies (GenCos) with the launch of a ₦590 billion first-tranche bond issuance under the NBET Finance Company Plc Bond Programme.
The initial tranche is fully guaranteed by the Federal Government and comprises ₦300 billion in cash bonds to be issued to the market and ₦290 billion in non-cash bonds to be directly allotted to GenCos on identical terms.
Details contained in the bond term sheet obtained on Tuesday revealed that the Series 1 bond will be issued between November and December 2025, with CardinalStone Partners Limited serving as the lead issuing house and financial adviser.
According to the term sheet, “Series 1 Tranche A involves ₦300 billion issued to the market for cash, while ₦290 billion under Tranche B is allotted to the GenCos on identical terms. The bond will be issued between November and December, with a seven-year tenor on a fixed-rate coupon, redeemed on an amortising basis and paid semi-annually in arrears.”
The bond carries a seven-year maturity, a fixed coupon rate and semi-annual interest payments, which will be amortised over the lifespan of the instrument.
Industry analysts describe the bond issuance as a major intervention by President Bola Tinubu’s administration to resolve what has become one of the most crippling financial crises in Nigeria’s power sector.
The huge debt owed to GenCos over unpaid electricity invoices has long constrained their ability to invest in capacity expansion, plant maintenance and gas supply obligations, thereby worsening power supply challenges across the country.
With the commencement of the bond programme, stakeholders say liquidity is expected to gradually return to the power generation segment, boosting investor confidence and stabilising electricity production nationwide.
