United Nigeria Airlines Company Limited has opened bids for an initial N20bn commercial paper issuance under a wider N100bn programme to plug short-term working capital needs. The sale makes the private carrier the first domestic airline in Nigeria to tap local debt capital markets through unsecured notes. Cheap bank credit remains scarce across Lagos, forcing ambitious domestic transport operators to test institutional debt investors directly.
The debut note split across two series with tenors of 270 and 364 days runs until October 20. Investors will eye the balance sheet carefully. While the airline grew top-line revenue from N10.3bn in 2021 to N90.8bn in 2025 with an annual profit of N23.8bn, recent half-year operations burnt through cash as aviation fuel costs and fleet lease charges surged.
Aviation in Nigeria punishes rapid balance-sheet leverage because local carriers earn depreciating naira while paying foreign currency for maintenance, leasing, and spare parts. Chairman Obiora Okonkwo has nonetheless positioned the airline for regional routes and planned flights to London, North America, and Europe. Bold network bets require deep reserves.
Money raised from the 100-billion-naira debt shelf must sustain daily flight operations and bolster working liquidity rather than finance long-term aircraft assets. Aviation funds face harsh scrutiny today. If institutional asset managers fully back the paper, other local airlines will quickly crowd the commercial debt queue to refinance costly short-term overdrafts.