Oando Secures N94.6billion Five-Year Medium Term Loan

Indigenous oil firm, Oando Plc on Monday, June 6, secured a N94.6 billion facility from nine local banks to enable it restructure its debt positions and improve earnings.

Coordinated by the mandated Lead Arranger, Access Bank Plc, the financing is a five-year Medium Term Note given at the Nigeria Interbank Offered Rate, NIBOR, plus 200 basis points, to assist the company meet its financial obligations in the low crude oil price environment.

The oil firm in a statement, said it has substantially reduced its debt profile in the last 24 months, and the new loan facility would enable key restructuring of its remaining debt.

Group Chief Executive of Oando Plc Wale Tinubu said: “In a bid to return to profitability in 2016, I am happy to announce the successful completion of the restructuring our overall debt profile into a N94.6 billion Medium Term, five-year consolidated facility, with a three-year moratorium on principal.”

“This is the pivotal leg in our group restructuring plan of growth; via the upstream business, deleverage; via the disposal of $350 million in assets’ value in 2016, and our return to profitability in 2016, driven by our dollar earning oil export and trading activities.”

“He said the company now stands diversified with higher weighted dollar denominated earnings, an optimised and restructured balance sheet with lower cost of capital and longer tenors.:

“With the upturn in global oil prices to levels above $50 per barrel, we now look forward to the successes of 2016, having ridden out the storm”.

Other banks in the financing deal include Diamond Bank, Ecobank, First City Monument Bank, Fidelity Bank, Stanbic IBTC Bank, United Bank for Africa Plc, Union Bank and Zenith Bank.

Oando has pledged to continue to exercise strong financial discipline.