and addressing any obstacles that may arise during it. This will also help to avoid longwinded negotiations. In some instances, in identifying these commercial objectives, parties’ objectives may be aligned, and in some instances, the objectives might not be aligned. Therefore, as a lawyer, understanding each party’s commercial objective would help in completing the transaction timely, overcoming obstacles and bottlenecks and significantly reducing negotiating time. (a) Foreign exchange liquidity is another key consideration in structuring large financing transactions in Nigeria. Exchange control exists in Nigeria and many of the borrowers generate revenue in Naira. Structuring transactions to deal with this currency mismatch and access to FX early on in transactions would ensure that foreign exchange risks and payment default risks are largely mitigated in transactions. (b) Other considerations include perfection requirements such as stamping and how parties plan to mitigate stamping costs. Stamping could create huge and unanticipated costs for the transactions, and since these sorts of costs are borne contractually by the borrower, it is important to consider how payment of stamping costs could be addressed in the transaction. Other factors to consider would include regulatory issues where the borrower is a regulated entity; tax exemptions that could apply in view of a lender’s status, or Can you give us some more background information on this financing and UUBO’s role as legal counsel? UUBO acted as Nigerian counsel alongside Norton Rose Fulbright (who acted as English counsel) to the European Investment Bank (EIB) (the ’lender’), in connection with its €100 million financing to MTN Nigeria Communications PLC (the ’borrower’ or ’MTNN‘). The loan is to be utilised by MTN to, among other objectives, expand the borrower’s 4G mobile broadband network in Nigeria. Our role included advising EIB on the transaction from a Nigerian law perspective and conducting a limited scope due diligence on the borrower. This required us to review the transaction documents and coordinate CPs, advise on tax issues and foreign exchange issues. What are the key considerations to take into account when advising on a large financing round such as this? In financing transactions generally, the commercial objective of the parties is a major factor in structuring the transaction Lawyer Monthly had the pleasure to speak with Onyinye Okafor at Udo Udoma & Belo-Osagie to give us some further insight into this transaction: It is important that the lawyers in the transaction inform the relevant parties about the peculiarities of the jurisdiction that could impact the transaction.
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