The Nigerian Stock Exchange has admitted the five-year corporate bond issued by Dangote Cement to investors.
Head of Listings Regulation Department of NSE, Mr. GodstimeIwenekhai, stated that the notes were listed on the exchange on Monday, June 15, 2020.
According to NSE, from April 3 to 15, 2020, Dangote Cement, a company trading its shares on the exchange, sold the papers to investors. The firm offered for sale N100bn worth of the debt notes at 12.50 per cent fixed rate under its N300bn debt issuance programme.
Dangote Cement offered a total of 100m units of the papers at of N1,000per unit, and the exercise, which had Meristem Stockbrokers Limited as its stockbroker, were subscribed by 100 percent.
The organisation is planning to pay holders of the bonds the interests semi-annually on every April 30 and October 30 for five years, when the notes should mature.
It has said the Series 1 bond would be redeemed in full on the maturity date, April 30, 2025, unless previously redeemed pursuant to Condition 5 of the Series 1 trust deed.
Meanwhile, Dangote Cement sold the notes two months ago; it said proceeds from the exercise would be used to re-finance existing short-term debt previously applied towards cement expansion projects, working capital and general corporate purposes.
The transaction was the largest corporate bond issuance in Nigeria’s debt capital market, reflecting Dangote Cement’s strong credit quality as well as the resilience of the nation’s debt capital market.
The exercise allowed the firm to lower its average cost of debt and extend the average maturity of its debt.
According to the Chief Executive Officer of Dangote Cement, Michel Puchercos, “This landmark transaction is the largest ever bond issuance by a corporate issuer in Nigeria.
“It allows us to further broaden our sources of funding by accessing long-term debt at competitive costs from the capital market and builds further on the success of our domestic commercial paper programme.
“The success of this transaction, in the current challenging environment, illustrates investors’ continuous confidence in Dangote Cement’s strategy, strong cash generation and solid credit profile.”
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