Dangote Sugar Raises N486bn Rights Issue to Reduce Debt, Strengthen Capital Base

By Adedapo Adesanya

Dangote Sugar Refinery Plc, Nigeria’s biggest sugar producer, has raised N486 billion ($356 million) through an oversubscribed rights issue as the company moves to reduce its debt burden and strengthen its capital base after three consecutive years of losses.

The company, founded by Mr Aliko Dangote, raised the funds through the issuance of 8.1 billion ordinary shares at N60 per share, according to a filing with the Nigerian Exchange (NGX) Limited on Friday.

The development follows shareholders’ approval of the capital-raising plan at the company’s 20th Annual General Meeting held in April.

In a statement signed by the Company Secretary, Mr Temitope Hassan, the sugar firm said the rights issue is part of efforts to improve its financial position and provide funding to support its long-term growth plans.

The company’s directors are authorised to raise up to N500 billion through a rights issue, on terms and at a time to be determined by the Board.

Dangote Sugar increased its share capital to accommodate the new shares issued under the rights issue. The sugar producer’s board also authorised to allot the shares and the management of any fractional holdings in accordance with regulatory requirements.

The organisation said any shares remaining unallotted after the offer would be cancelled as permitted by law, describing the capital raise as one of the largest rights issues in Nigeria’s corporate history.

The capital raise comes against the backdrop of improved revenue performance but continued losses at the company.

In its 2025 audited results, Dangote Sugar recorded a 24.56 per cent increase in revenue to N829.2 billion, compared with the previous year. The growth was driven largely by strong demand for 50kg sugar, which generated N807 billion in revenue.

Retail sugar sales contributed N17.7 billion, while molasses and freight income generated N4.02 billion and N66.4 million, respectively.

Cost of sales increased by 11.35 per cent to N706.5 billion, largely due to raw material costs of N573.3 billion. This resulted in a gross profit of N122.6 billion.

Despite the improvement in revenue and gross profit, the company recorded a pre-tax loss of N72.2 billion in 2025, although this represented a significant improvement from the N270.8 billion loss reported in 2024.

Lagos remained the company’s largest market, accounting for 55.82 per cent of regional sales, followed by the North with 35.35 per cent, the West with 6.45 per cent and the East with 2.38 per cent.

The fresh capital is expected to provide Dangote Sugar with additional financial capacity as it works to reduce its debt obligations, strengthen its balance sheet and advance its long-term expansion plans.