Geregu Power Plc has defaulted on its N40.09 billion Series 1 Senior Unsecured Bond, according to a new update from FMDQ Securities Exchange.
The company failed to pay both its eighth semi-annual interest due and the fourth scheduled principal repayment. The notice from FMDQ confirms the breach and puts the power generation firm under increased scrutiny.
The default comes at a difficult time for Geregu. The business has seen a steep drop in operating cash flow, while earnings have also weakened sharply. For one of Nigeria’s leading listed power producers, the missed obligations signal mounting pressure on its finances.
The bond in question was issued on July 28, 2022, as part of a N100 billion debt programme. It is a 7-year instrument with a fixed coupon of 14.50%. Payments were structured as semi-annual interest, with principal repaid in parts until final maturity on July 28, 2029.
Because the missed payments occurred mid-way through the bond’s life, not at maturity, questions are now being raised about Geregu Power’s immediate liquidity. Investors and market watchers will be watching closely to see how the company addresses the shortfall in the coming months.
