Deutsche Bank Leads $747 Million Syndicated Loan for Lagos-Calabar Coastal Highway

Strategic Insights -

Deutsche Bank has made a major milestone in Nigerian and West African infrastructure development by leading a $747 million syndicated loan to finance Phase 1 Section 1 of the Lagos-Calabar Coastal Highway. This move marks the first syndicated road infrastructure loan of its size in Nigeria, signifying global investor confidence in the country's reform trajectory and infrastructure pipeline. The loan is structured as an EPC+F contract awarded to Hitech Construction Company, one of Nigeria's leading infrastructure firms, which has already completed over 70% of the construction. The highway is designed to be a vital trade and logistics corridor, enhancing regional integration, tourism, and reducing transport costs while creating jobs.

Key Takeaways:

  • The Lagos-Calabar Coastal Highway project is a key component of Nigeria's infrastructure development agenda, with Phase 1 Section 1 spanning 47+47km from Victoria Island to Eleko Village.
  • The $747 million syndicated loan is the first of its kind in Nigeria, reflecting global investor confidence in the country's reform trajectory and infrastructure pipeline.
  • The project is structured as an EPC+F contract awarded to Hitech Construction Company, one of Nigeria's leading infrastructure firms, which has already completed over 70% of the construction.
  • The highway is designed to be a vital trade and logistics corridor, enhancing regional integration, tourism, reducing transport costs, and creating jobs.
  • The loan is supported by partial political and commercial risk insurance from the Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC).
  • The project's financing includes support from development finance institutions, export credit agencies, and international commercial banks, including First Abu Dhabi Bank, the African Export-Import Bank, and the ECOWAS Bank for Investment and Development.
  • The Lagos-Calabar Coastal Highway will have a minimum lifespan of 50 years with minimal maintenance, offering high durability and cost-effectiveness.
  • A tolling strategy is being finalised to ensure the project's operational and financial sustainability.
  • Financing for subsequent phases is already being structured, with strong interest from regional and international investors.

Statistics:

  • $747 million: the amount of the syndicated loan led by Deutsche Bank.
  • 47+47km: the length of Phase 1 Section 1 of the Lagos-Calabar Coastal Highway.
  • 70%: the percentage of the construction of Phase 1 Section 1 already completed.
  • 50 years: the minimum lifespan of the Lagos-Calabar Coastal Highway.
  • $1.45 billion: the total length of the Lagos-Calabar Coastal Highway.

Sources:

  • Federal Republic of Nigeria. (n.d.). Nigeria's infrastructure development agenda.
  • Deutsche Bank. (n.d.). Lagos-Calabar Coastal Highway Project.
  • Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC). (n.d.). ICIEC provides partial political and commercial risk insurance for the Lagos-Calabar Coastal Highway Project.
  • First Abu Dhabi Bank. (n.d.). Supports the Lagos-Calabar Coastal Highway Project.
  • African Export-Import Bank. (n.d.). Supports the Lagos-Calabar Coastal Highway Project.
  • ECOWAS Bank for Investment and Development. (n.d.). Supports the Lagos-Calabar Coastal Highway Project.