SEVEN Energy International Limited, with its wholly-owned subsidiary- Accugas Limited, closed a $170 million medium-term acquisition finance facility with FBN Bank (UK) Limited and Ecobank Nigeria Limited.
The nation’s FBN Capital Limited acted as structuring bank, sole initial mandated lead arranger, financial modelling bank and global facility coordinator, would help Seven Energy to acquire East Horizon Gas Company Limited (EHGC).
The 5.5-year period facility, also involved Aluko & Oyebode as lenders’ legal counsel; Royal HaskoningDHV Nederland BV represented the lenders on environmental/technical due diligence matters, while UUBO and Addleshaw Goddard acted as the borrower’s local and international legal counsels respectively.
The facility part-finances the acquisition of the entire issued share capital of EHGC for a total consideration of $250 million.
EHGC was established by Oando Plc with the intention of constructing and operating an 18-inch, 128-kilometre gas pipeline that connects with the Obigbo-Alscon pipeline at Ukanafun to supply gas to an industrial offtaker located in Mfamosing, Cross River State, and to meet the needs of other industrial users in the Calabar region.
But Seven Energy’s acquisition of EHGC has already been adjudged as in line with its strategic plans to expand its gas infrastructure assets in the south east Niger Delta.
Through its assets and subsidiary- Accugas, Seven Energy has a number of infrastructure projects in the region, including a gas processing facility at the Uquo Field and a gas pipeline network, which will have the capability to supply gas in the Port Harcourt, Aba and Calabar areas.
The Chief Executive Officer, Seven Energy, Phillip Ihenacho, said: “This is a landmark transaction for us. We are delighted to expand our midstream operations in Nigeria with this investment. It is a perfect fit to our strategy of investing in core midstream infrastructure assets in the south east region of the country. I would also like to thank the entire team for their achievement in bringing this important financing transaction to a close.”
Also commenting, the Chief Financial Officer, Seven Energy, Bruce Burrows, commended the lenders for their support, and in particular, their dedication to ensure that the completion of the EHGC acquisition process was in line with the sponsors’ timetable.
Burrows also lauded FBN Capital’s role, particularly in working closely with Seven Energy, the lenders and the various independent consultants in concluding the transaction.
However, the Managing Director and Chief Executive Officer of FBN Capital Limited, Kayode Akinkugbe, said: “FBN Capital is very proud of the instrumental role it played in assisting Seven Energy to structure and arrange the financing for the acquisition.
“FBN Holdings Group feels a strong sense of responsibility towards fostering growth in the power, gas pipeline and oil and gas sectors and we will continue to deploy our extensive debt arranging experience and structuring expertise in executing robust transactions in record time”.
The Director and Head of Debt Solutions, FBN Capital Limited, Patrick Mgbenwelu, said: “We appreciate the responsibility and trust Seven Energy has placed with FBN Capital to advise and arrange the financing for the acquisition of EHGC. FBN Capital remains committed to further strengthening this relationship and supporting Seven Energy in realising its various financing goals and objectives”.
