InfraCredit admits AIICO Insurance as 2nd domestic institutional investor

By Motolani Oseni

A specialised infrastructure credit guarantee institution, InfraCredit said, it has admitted equity investment of AIICO Insurance Plc, representing five percent of total share capital of InfraCredit and joining Leadway Assurance Plc as the second private domestic institutional investor.

Further to this new equity investment, InfraCredit’s paid-in capital base will increase to US$175.14 million(N148.55 billion) translating to an aggregate guarantee issuing capacity of up to N742.77 billion (c.USD 875.7 million).

The equity investment will be part of InfraCredit’s core capital and will enhance InfraCredit’s guarantee issuing capacity to sustain InfraCredit’s ‘AAA’ credit rating. It will also result in the diversification of InfraCredit’s ownership structure in line with its envisioned capital structure.

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InfraCredit would continue to deploy innovative credit enhancement solutions in mobilizing private sector financing for infrastructure projects in key sectors of the Nigerian economy.

Established in 1963, AIICO Insurance is one of the largest life insurers in Nigeria and a major underwriter for general insurance by premiums written.

Speaking on the investment, CEO, AIICO Insurance, Mr. Babatunde Fajemirokun said,

this investment is the evolution of “what we at AIICO Insurance believe will be a long-term partnership with InfraCredit. Over the past two years, AIICO Insurance has invested in InfraCredit guaranteed bonds, and participated in novel financing arrangements promoted by the company to bring infrastructure investment to areas that have been significantly underserved.

“With this investment, AIICO Insurance underscores its commitment to bridging the infrastructure gap in the country, partnering with InfraCredit for the long haul.”

Welcoming AIICO as a new shareholder of InfraCredit, chairman of the InfraCredit, Mr. Sanjeev Gupta, said, AIICO’s investment is in line with its vision of creating a strong partnership between the public and private sectors, adding that, this partnership aims to attract private sector capital for infrastructure financing in a sustainable manner, saying, this investment marks another significant turning point and a significant milestone for InfraCredit, as it aim to increase private sector involvement in the ownership structure.

Commenting on the new equity investment, the chief executive officer(CEO), InfraCredit, Mr. Chinua Azubike stated that the admission of AIICO Insurance, the second private domestic institutional investor in InfraCredit, reinforces the confidence in the sustainability of InfraCredit’s unique business model.

To him, “AIICO’s equity investment further strengthens our core capital base and expands our guarantee capacity as we continue to act as a catalyst to attract domestic credit from pension funds, insurance firms and other long-term institutional investors into credit-worthy infrastructure projects. This equity investment from AIICO aligns with our sponsor’s strategic objective to broaden our investor base through private sector participation, thus expanding our capitalization and strengthening our capacity to deepen market penetration.

“We are pleased to have AIICO as a shareholder, and we aim to strengthen our cooperation towards advancing sustainable finance for impactful Infrastructure projects in Nigeria.”