VFD Group’s debt offer gets 175 per cent subscription
VFD Group raised N525 million in one week, exceeding the target of its Debt Note product, representing a 175 per cent subscription, in an offer designed to raise N300 million, which closed since February.
The financial services focused investment group issued fixed rate unsubordinated secured Debt Notes of N1 million only per note to sophisticated individual and corporate investors.
However, investors whose applications were rejected would be advised on an alternate investment product with features similar to the Debt Note based on their show of confidence and commitment to the company, but subject to their consent.
The Head of Sales at VFD Group, Adenrele Omolara, said: “We thoroughly researched the investment market and discovered the need for a retail-focused, high yield and tradeable financial instrument promoted and issued by a company with an impeccable reputation.
“The excitement exhibited by investors towards the offer was an indication of the Group’s understanding of the market’s needs.”The Debt Notes were set at an interest rate of 19 per cent per annum with a one-year tenor and backed by the issuer’s equity portfolio held by United Capital Trustees, thus giving the Debt Notes a 1:2 cover ratio.
The Group Managing Director of the company, Nonso Okpala, said VFD Group’s Debt Note affords retail investors an opportunity to earn a minimum interest of 19 per cent with prospect of an enhanced yield as a result of the tradability of this financial instrument.Based on the product’s term sheet, Anchoria Asset Management (AAM), will provide an Over-The-Counter (OTC) platform for the purpose of trading these notes.
There are also plans to list the Debt Notes on FMDQ, as this is an innovative pilot scheme aimed at establishing an active OTC market for Debt Notes.“You can always count on VFD Group to provide leadership in product and service innovation in the financial sector,” Okpala said.
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