The development comes amid a sharp deterioration in Geregu Power’s revenue, profitability and operating cash flows, raising concerns over its immediate liquidity and debt-servicing capacity. However, the bond default indicates that liquidity pressures remain significant. Despite the deterioration, GCR Ratings affirmed Geregu Power’s national scale long-term issuer rating at ‘A(NG)’ with a Stable outlook. This suggests that while GCR remains confident in Geregu Power’s long-term business fundamentals, the bond default has exposed a serious short-term cash-flow challenge. Geregu Power acquired generating assets in Ajaokuta in 2013 and was listed on the Nigerian Exchange four years ago amid strong investor expectations of earnings growth in Nigeria’s power sector.