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Starsight Energy (Starsight), a Nigeria-based, Africa-focused solar energy provider, announced the conclusion of a competitive local currency agreement with Chapel Hill Denham Nigeria Infrastructure Debt Fund (NIDF), for a 10-year, NGN8 billion refinancing of US$20 million of current debt with two development finance institutions (DFIs) invested in the energy sector in Africa.
The new facility – Starsight’s second with NIDF – replaces Starsight’s current facilities with Norfund (the Norwegian Government Investment Fund for Developing Countries) and Finnfund (the Finnish Fund for Industrial Cooperation Ltd).
Paul van Zijl, Starsight’s Group Chief Financial Officer, explains: “The DFI facilities were secured when we were a much smaller company when most funders did not show substantial interest in Starsight. Norfund and Finnfund were invaluable funders to the company in its early guise and we remain very grateful for their support to date. The logic for refinancing the US dollar debt in local currency was just too compelling to ignore”.
The increased difficulty in sourcing US dollars in Nigeria, together with the devaluation of the Nigerian Naira in the parallel market over the past five years, has made US dollar debt increasingly expensive, van Zijl adds.