Earlier, Dangote Cement Plc announced the successful offering of its N100 billion Series 1 Fixed Rate Senior Unsecured Bonds.
In a statement by the firm, the bond sale was stated to have been oversubscribed by a broad variety of investors despite the COVID-19 outbreak which has generated anxiety in the financial markets. Note that some of the investors that subscribed to the Dangote Cement bond include Nigerian pension funds managers, asset managers, insurance firms, banks, and even overseas fund managers. The whole book amounted to N155 billion.
The N100 billion Series 1 Fixed Rate Senior Unsecured bonds will be payable in April 2025. It is Dangote Cement’s maiden bond sale in the Nigerian debt market and part of a broader N300 billion programme which the business has planned.
The bond offering was also touted as the biggest corporate bond ever issued in the Nigerian financial market. Proceeds from the capital transaction will be utilized to repay the company’s previously existing short-term debt which was used to assist several cement expansion projects. In the same line, part of the revenues will also be utilized as working capital and to support general corporate initiatives.
While remarking on the successful offering, the company’s Chief Executive Officer, Michel Puchercos, termed it as a milestone transaction. He said:
“This landmark transaction is the largest ever bond issuance by a corporate issuer in Nigeria. It enables us to further extend our sources of finance by acquiring long-term debt at competitive pricing from the capital market and builds further on the success of our domestic commercial paper programme. The completion of this transaction, in the present adverse climate, indicates investors’ ongoing trust in Dangote Cement’s strategy, robust cash creation, and outstanding credit profile.”
culled from: Nairametrics