Dangote Cement to raise N100bn through bond issuance

Dangote Cement Plc, Africa’s leading cement manufacturer, is seeking to raise up to N100 billion in fresh funds from the bond market, under its NGN300 billion Debt Issuance Programme.

According to the investor presentation document prepared by the company with the theme ‘Building Prosperity in Africa’ indicated that the funds from the debut offering in the bond markets are to be utilised to refinance existing short-term debt previously applied towards cement expansion projects, working capital and general corporate purposes.

The maiden bond - a medium term debt paper - the company is issuing signifies confidence in business growth and in the Nigerian economy long term growth.

The company’s management describes the bond as a good offer for discerning institutional investors and high networth individuals given the fact that Dangote Cement Plc is Nigeria’s largest company by market capitalisation on the Nigerian Stock Exchange.

The company, which is Premium board-listed on the NSE, has a strong corporate governance framework supported by five Independent Directors while its shareholding base is diversified.

It posted an excellent financial performance in 2019 with EBITDA margins of 44.3 per cent and was rated ‘Strong financial profile including low leverage and significant operational scale.’ (GCR AA+(Ng) (Jan 20) Moody’s Aa2. ng (Mar 20)

The company also has a strong track record in the debt capital markets, having registered a NGN150 billion Commercial Paper programme in 2018, and issued an aggregate amount of NGN300 billion in Commercial Paper since the programme was established.

It also has a track record in Nigeria’s Debt Capital Markets as it raised an aggregate Issuance of N100bn under the Commercial Paper Programme in 2018, in 2019, raised an aggregate Issuance of N200bn under the Commercial Paper Programme. These Commercial Papers were systematically oversubscribed.