Dangote Cement Sells N116bn Series 2 Bond to Implement Export Strategy

By Dipo Olowookere

A leading cement company in Africa, Dangote Cement Plc, has completed the sale of the second tranche of its fixed rate senior unsecured bonds under its N300 billion multi-instrument issuance programme.

In the series 2 bond issuance, the cement maker sold N116 billion to institutional investors including pension funds, asset managers, banks, insurance companies and high net-worth individuals.

According to Dangote Cement, the proceeds will be used to finance its Nigerian expansion projects and implement its export strategy. It will also be used for its short-term debt refinancing and working capital requirements.

Business Post reports that in 2020, the cement manufacturer started the export of clinker to African countries and a year later, it suspended it and later resumed a few months after.

In a notice on Wednesday, Dangote Cement said the N116 billion sale was in three tenors of 5 years, 7 years and 10 years.

According to the disclosure, the 5-year note was sold at 11.85 per cent, the 7-year paper was priced at 12.35 per cent, while the 10-year maturity was issued at 13.00 per cent.

“Dangote Cement is delighted to have successfully undertaken a second issuance under our Multi-Instrument Issuance Programme which was launched last year and even more delighted to have concluded the most significant corporate bond issuance in the history of the Nigerian debt capital markets.

“This landmark transaction would fund our expansion projects and further support the implementation of our export strategy,” the Group Managing Director of Dangote Cement, Mr Michel Puchercos.

“I want to thank our stakeholders and investor community for their strong participation in another bond issuance with the company,” Mr Puchercos said further.

For the series 2 bond issuance, Stanbic IBTC Capital was the lead issuing house/bookrunner, while Absa

Capital Markets, Meristem Capital, Standard Chartered, United Capital, Coronation Merchant Bank, Ecobank Development Company, FBNQuest Merchant Bank, FCMB Capital Markets, Futureview Financial Services, Vetiva Capital, Quantum Zenith Capital and Rand Merchant Bank Nigeria were the joint issuing houses.

Dangote Cement stated in the notice that the bond will be listed on the Nigerian Exchange (NGX) Limited and FMDQ Securities Exchange.