By Busola Aro

Geregu Power Plc has defaulted on the eighth coupon or interest payment and fourth bullet principal repayment of its N40.09 billion series one senior unsecured bond.

This is contained in an updated listing status published by FMDQ Securities Exchange, seen on Sunday.

The bond, which was issued on July 28, 2022, has a seven-year tenor and is scheduled to mature on July 28, 2029, according to details published by the FMDQ.

The bond carries a 14.5 percent coupon and was issued under Geregu Power’s N100 billion multi-instrument issuance programme.

“Credit Default in the 8th coupon payment and 4th bullet principal repayment,” the FMDQ listing details said.

“The Series 1 bond was issued as a senior, direct, irrevocable and unsubordinated obligation of Geregu Power. It ranks pari passu with the company’s other unsecured and unsubordinated indebtedness.”

Geregu Power had raised the N40 billion through the bond issuance to support its funding requirements and planned expansion projects.

At the time of the issuance, Global Credit Rating (GCR) assigned the bond a national-scale long-term rating of A(Na), equal to the issuer’s rating.

The GCR said the rating reflected Geregu Power’s position as a leading Nigerian power generation company and its relatively high generation capacity, which had supported its earnings.

However, the rating agency identified challenges, including illiquidity in Nigeria’s power sector, a concentrated customer base, and expected pressure on the company’s leverage metrics.

The GCR had also said the outlook was “Evolving”, reflecting uncertainty around the company’s fundraising plans, execution of planned projects, and expected recovery in revenue.

The agency warned that delays in project execution could put further pressure on Geregu Power’s leverage and increase refinancing risks.

It also identified aggressive dividend payments amid ongoing expansion and weaker-than-expected earnings arising from production losses as potential triggers for a downgrade.

Earlier this year, the board of the company approved N9 as dividend payments to shareholders.

The development comes eight months after Femi Otedola, the company’s former chairman, sold his majority stake in Geregu for N1.088 trillion in December 2025.

Source: TheCable