It is one of the most interesting news in Nigeria in recent times. In the midst of Nigeria’s economic lull, Old Mutual and the Nigeria Sovereign Investment Authority, NSIA will be investing USD 700 million in Nigeria’s real estate and agricultural sector.
As part of the agreement, Old Mutual and NSIA will raise USD500 million for real estate investment while another USD200 million will be raised for investment in agriculture
On the real estate side of things, the fund will invest in office towers and residential property. This is a big boost to Nigeria’s construction sector as this will further create jobs.
As a sign of their seriousness, the partnership has already committed USD100 million to the real estate fun and USD50 million to the agriculture programme.
The real estate and agriculture funds will each have a tenor of up to 12 years, targeting a return of around 20%, said Hywel George, the Chief Investment Officer of Old Mutual Investment Group. He did not state when and where the fund will be issuing the bond offer and what coupon rate.
Nigeria started the NSIA in 2011 with a seed capital of USD1 billion, the fund received additional USD250 million investment capital which was approved by the federal government in November 2015.
The NSIA has three funds: the Future Generations Fund with 40% weighting the Nigeria Infrastructure Fund with 40% fund weighting, and the Stabilization Fund with 20% weighting.
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