Geregu Power Plc, one of Nigeria’s premier listed electricity generators, has defaulted on a bond payment for the first time in the country’s corporate debt market in seven years, a stumble that lands just as regulators are trying to convince investors the power sector’s finances are finally being cleaned up.
Corporate defaults of any kind are rare in Nigeria’s debt capital market, where borrowers with the scale to issue bonds have historically guarded their credit standing carefully, particularly when, like Geregu, they carry investment-grade ratings from Agusto & Co. and GCR Ratings.
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Geregu’s bond, issued on July 28, 2022, at a fixed 14.5 percent under the company’s N100 billion debt programme, was intended to mature in July 2029.
“It is very unusual for a corporate bond to default in Nigeria,” said an investment-market source familiar with the sector. “The question now is whether this is a temporary liquidity issue or whether it reflects something deeper in the company’s operations.”
