United Nigeria Airlines has raised N22 billion through its debut commercial paper (CP) issuance, exceeding its initial N20 billion target by 10% following strong investor demand.
The fundraising marks the airline’s entry into Nigeria’s short-term debt market and represents the first tranche of its N100 billion commercial paper programme, which is designed to support working capital requirements, fleet expansion and its broader growth strategy.
The airline received subscriptions exceeding its initial target by more than N5 billion, according to Meristem Capital Limited, which acted as the lead issuing house for the transaction.
However, United Nigeria Airlines limited the additional allotment to N2 billion, bringing the total amount raised to N22 billion, while returning the remaining subscription funds to investors.
Managing Director of United Nigeria Airlines, Mazi Osita Okonkwo, said the strong demand reflected investor confidence in the airline’s business model, financial performance and expansion plans. He said the proceeds would be deployed towards strengthening operations and expanding the airline’s fleet.
Rasaki Salawu, Managing Director of Meristem Capital Limited, described the transaction as Nigeria’s first commercial paper issuance by an airline.
He said the offer attracted participation from asset managers, insurance companies and high-net-worth individuals, adding that the decision to cap the additional allotment reflected a prudent approach to fundraising.
The issuance comprised two series with tenors of 270 and 364 days. Agusto & Co. assigned ratings of A3 and BBB- for the short-term and long-term instruments, respectively, with a stable outlook.
DataPro also assigned A1 and BBB ratings to the respective tenors, while Cordros Capital and other dealers participated in the transaction.
Airline Plans to Expand Fleet to 16 Aircraft
United Nigeria Airlines’ capital-raising exercise forms part of a five-year expansion strategy covering domestic, regional and international operations. The airline currently operates 10 aircraft, comprising Embraer ERJ-145s, Boeing 737-800s, Embraer E190s and CRJ900s.
It plans to take delivery of six additional aircraft before the end of 2026, potentially increasing its fleet to 16 aircraft if the deliveries are completed as scheduled. The airline currently serves 14 destinations across Nigeria and Ghana and has secured approvals to operate as a flag carrier to six international destinations.
