BUA Cement eyes dual listing after 37.82% oversubscription of N100bn corporate bond

By Charles Abuede

BUA Cement Plc has revealed that following the successful conclusion of its N100 billion bond offering during its Series-1 fixed-rate senior unsecured bond issue under the company’s maiden N200 billion bond issuance programme, an application to dual list the bonds on relevant exchanges would be made. The company said the dual listing application will come after the receipt of the necessary approvals.

The recently concluded Series-1 fixed-rate senior unsecured bond issue under BUA Cement’s maiden N200 billion bond issuance programme saw a 37.82 per cent oversubscription level to the tune of N137.82 billion.

The cement manufacturer asserted that this has become the largest ever corporate bond issued in the Nigerian debt capital market and indicates the growing investor confidence in the business model of the second-largest cement company in Nigeria.

Abdul Samad Rabiu, chairman of BUA Cement Plc, speaking on the successful conclusion of the issuance programme said, “This is the largest corporate bond offering in the history of Nigeria’s debt capital market. Last year, we made a strategic decision as a proudly Nigerian company to list BUA Cement on the Nigerian Stock Exchange. This was in line with our core strategy to continue seeking out viable investment and growth opportunities within Nigeria.

“This bond issuance, a first by BUA Cement demonstrates our confidence in Nigeria’s debt capital market as well as continued investor confidence in the BUA Cement business model, our management team, and long-term strategy, all supported by strong credit ratings. We remain committed to unlocking opportunities within the industry for Nigeria,” Rabiu added.

Also commenting on the transaction, Yusuf Binji, chief executive officer, BUA Cement, said: “The transaction, being the largest corporate bond issuance in the history of Nigeria’s debt capital markets reiterate the strength and acceptance of the BUA Cement brand and the trust placed by stakeholders in the company’s strong cash generation capacity, credit profile and strategy driven by a well experienced management team. Diversifying and extending the duration of our funding sources with the inclusion of this bond, at a competitive rate, will further, enable us to achieve our strategic objectives and vision.”

Meanwhile, the company’s board of directors has approved the incorporation of the excess funds, not more than 15 per cent of the offer value, as only N115 billion would be employed in line with regulatory guidelines.