United Nigeria Airlines plans N20 billion commercial paper issuance

United Nigeria Airlines said it intends to raise N20 billion through commercial paper, which it described as the first of its kind by a domestic airline in Nigeria, as it seeks to strengthen its finances and fund expansion.

The proposed issuance is the first tranche of a N100 billion commercial paper programme, and will comprise two series with tenors of 270 and 364 days, according to a statement by the airline’s management on Friday.

Commercial paper is a short-term debt instrument companies use to raise funds for working capital and other business needs. Unlike equity financing, it involves borrowing that must be repaid based on agreed terms.

According to the airline, the proposed issuance is part of its strategy to strengthen its financial position while expanding operations across domestic, regional, and international markets.

Meristem Capital Limited will serve as the lead arranger, while Cordros Advisory Services Limited, Coronation Merchant Bank Limited, FCMB Capital Markets Limited, FSL Advisory Limited and Quantum Zenith Capital and Investments Limited will act as dealers.

United Nigeria Airlines said it has obtained credit ratings from two agencies for the proposed issuance.

According to the airline, Agusto & Co. assigned it an A3 short-term rating and a BBB- long-term rating, both with a stable outlook. DataPro assigned the airline an A1 short-term rating and a BBB long-term rating.

The ratings provide investors with an assessment of the airline’s creditworthiness, although they do not guarantee repayment or eliminate the risks associated with investing in the commercial paper.

The airline’s September 2026 investor presentation showed substantial growth in its financial performance over the past five years.

Revenue rose from N10.3 billion in 2021 to N90.8 billion in 2025, while profit after tax increased from N1.3 billion to N23.8 billion over the same period.

The company reported revenue of N95.6 billion in the first half of 2026.

It also said turnover rose to N19.4 billion in August from N14.1 billion in July, and it recorded a net profit of N1.2 billion in August.

The airline said it expects its financial performance to continue improving.

Fleet expansion planned

The airline said it currently operates ten aircraft, comprising Embraer ERJ-145s, Boeing 737-800s, Embraer E190S and CRJ900s, adding that it plans to take delivery of six additional aircraft before the end of the year.

United Nigeria Airlines serves fourteen destinations across Nigeria and Ghana, and said it has secured approval to operate as a flag carrier to six international destinations.

The planned fleet expansion is expected to support its efforts to increase capacity and extend its reach beyond the domestic market. However, the scale and timing of the expansion will depend on the airline’s ability to secure the necessary financing, take delivery of additional aircraft and meet applicable regulatory requirements.

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The airline has also taken steps to expand its access to international travel distribution networks.

The company says it has signed agreements with Amadeus and Sabre, systems travel agents and other travel service providers use to access airline schedules and ticket inventory.

In April, United Nigeria Airlines joined the International Air Transport Association’s Multilateral Interline Traffic Agreement, which provides a framework for airlines to cooperate on passenger bookings and connections across their networks.

In June, the airline became a full member of the African Airlines Association, a continental body that promotes cooperation and the development of Africa’s aviation industry.