Dangote Cement’s N50bn bonds to be listed on NGX, FMDQ

Africa’s largest cement producer, Dangote Cement Plc recently announced the successful issuance of N50 billion Series 1 Fixed Rate Senior Unsecured Bonds under the company’s new N300 billion Multi-Instrument Issuance Programme.
The bonds, which were issued on May 26 2021 at coupon rates of 11.25percent, 12.50 percent and 13.50percent 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 (HNIs).

The bonds will be listed on the Nigerian Exchange Limited and FMDQ Securities Exchange.

Absa Capital Markets Nigeria acted as Lead Issuing House for the Series 1 Bonds, 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 Plc said the proceeds of the bond issuance will be deployed for the company’s expansion projects, short-term debt refinancing and working capital requirements.

Aside from this first issuance of a traditional bond under the new Multi-Instruments Programme, Dangote Cement has registered a programme enabling it to consider different types of fixed income instruments to cater for different type of investors. The ability to issue Green Bonds and Sukuk will enable the company leverage the depth and breadth of the Nigerian market.

Read Also: 11 Plc to buy 51% stake in Capital Hotels Plc

“This bond issuance allows us 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,” said Michel Puchercos, Chief Executive Officer of Dangote Cement Plc while commenting on the bond issuance.

Dangote Cement Plc is Sub-Saharan Africa’s largest cement producer with an installed capacity of 48.6Mta capacity across 10 African countries. The company operates a fully integrated “quarry-to-customer” business with activities covering manufacturing, sales and distribution of cement. Dangote Cement Plc has a production capacity of 32.3Mta in our home market, Nigeria.

Its Obajana plant in Kogi State, Nigeria, is the largest in Africa with 16.3Mta of capacity across four lines; its Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta, while its Gboko plant in Benue state has 4Mta.

Dangote Cement Plc through its current investment has removed Nigeria’s dependence on imported cement. It has transformed the nation into an exporter of cement serving neighbouring countries. In addition, Dangote Cement Plc has operations in Cameroon (1.5Mta clinker grinding), Congo (1.5Mta), Ghana (1.5Mta import), Ethiopia (2.5Mta), Senegal (1.5Mta), Sierra Leone (0.5Mta import), South Africa (2.8Mta), Tanzania (3.0Mta), Zambia (1.5Mta).

Dangote Cement Plc has a long-term credit rating of AAA 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 cashflow, and low leverage.