AFFIC structured a 3 billion FCFA financing facility for a Senegalese parapublic entity, enabling the clearing of supplier arrears and the immediate improvement of its balance sheet.

About the deal

This operation addresses a recurring problem for semi-public entities: managing working capital requirements and settling supplier debts. A strategic Senegalese state entity was facing an accumulation of trade receivables, creating cash flow problems and weakening its ecosystem of local suppliers.

The objective of this 3 billion FCFA (approximately 4.5 million euros) transaction was to replace this costly and volatile short-term commercial debt with structured medium-term bank debt. By raising these funds from the local banking system, the entity was able to immediately pay its suppliers, thus restoring the climate of confidence essential to the continuation of its operations.

This refinancing is part of an active liability management approach. It not only allows the debt burden to be spread over a period tailored to the entity's ability to pay, but also injects vital liquidity into the local economy (SMEs). The success of this fundraising demonstrates the solvency of public entities when supported by rigorous financial structuring.

The role of AFFIC

AFFIC acted as mandated financial advisor to structure and execute this fundraising. Our first task was to conduct a critical review of the entity's financial commitments and model its debt service coverage ratio (DSCR) to reassure potential lenders.

We then prepared the financing package, defining the security mechanisms and repayment flows (escrow, direct deposit of income, etc.) necessary to mitigate the credit risk perceived by the banks. AFFIC conducted discussions with several financial institutions in Dakar to obtain the best market conditions for this amount of 3 billion FCFA.

Our role as an intermediary accelerated the credit committees' decision-making process and removed the legal conditions precedent. By transforming a current liability into stable resources, AFFIC provided a concrete solution to its public client's liquidity challenges, confirming its expertise in financing state and semi-public entities.

Deal Team