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To list bonds on NGX and FMDQ platforms
Sub-Saharan Africa’s largest cement producer, Dangote Cement plc, says it has successfully undertaken the issuance of N50 billion Series I fixed-rate senior unsecured bonds under a N300 billion multi-instrument issuance programme which it said will be listed on the Nigerian Exchange Limited and the FMDQ Securities Exchange due to its wide reception.
The company, in a disclosure filed to the local bourse, revealed that the bonds, which were issued in May 2021 at coupon rates of 11.25 percent, 12.50 percent and 13.50 percent for the 3, 5, and 7-year tranches respectively, were well received and recorded participation from a wide range of investors, including domestic pension funds, asset managers, insurance companies and high net-worth investors, despite market headwinds.
It further stated that the proceeds from the issuance will be deployed for the company’s expansion projects, short-term debt refinancing and working capital requirements.
The statement further disclosed that Dangote Cement has registered a programme enabling it to consider different types of fixed income instruments to cater for different types of investors, which is aside from the issuance of the first traditional bond under the new multi-instruments programme. The programme will also enhance the largest cement manufacturer’s ability to issue green bonds and Sukuk bonds as it enables the company to leverage the depth and breadth of the Nigerian market.
Michel Puchercos, chief executive officer, Dangote Cement, while commenting on the successful bond issuance, said, “This bond issuance allows us to move a step further in achieving our expansion objectives and will be deployed to projects instrumental in supporting our export strategy while improving our cost competitiveness. We thank the investor community for their continued support in the management of Dangote Cement and their successful participation in the bond issuance.”
Acting as the lead issuing house for the Series I bond was Absa Capital Markets Nigeria, while Stanbic IBTC Capital, Standard Chartered Capital & Advisory Nigeria Limited, United Capital Plc, FBN Quest Merchant Bank, FCMB Capital Markets, Coronation Merchant Bank, Ecobank Development Corporation Nigeria, Futureview Financial Services, Meristem Capital Limited, Rand Merchant Bank, Quantum Zenith Capital and Vetiva Capital Management acted as joint issuing houses.
Dangote Cement has a long-term and excellent credit rating of AAA (highest safety) by GCR and Aa2.ng by Moody’s due to its market-leading position, significant operational scale, and strong financial profile evidenced by the company’s robust operating and net profit margins relative to regional and global peers, adequate working capital, good cash flow, and low leverage.
