By Dipo Olowookere
Commercial paper worth N20 billion is being offered for sale to investors in the nation’s capital market by one of the leading brewers, Nigerian Breweries.
The brewery giant is selling the paper off its N100 billion commercial paper programme approved by the Securities and Exchange Commission (SEC), the apex regulatory organisation in the Nigerian capital market.
Business Post reports that the exercise commenced on Wednesday, January 11, 2023, and would end on Monday, January 16, 2023.
The commercial paper sales are in three maturities of 91 days, 120 days and 154 days.
Commercial papers are debt instruments issued to investors by corporate organisations to raise funds for short-term needs. They are usually of a maximum of 270 days, about nine months. The issuance of commercial papers is a cheaper way to source funds, and their rates are lower than the rates offered by commercial banks.
In the ongoing Nigerian Breweries CP sales, the discount rate is 12.59 per cent for the 91-day note (Series 1), 13.38 per cent for the 120-day paper (Series 2) and 14.11 per cent for the 154-day instrument (Series 3).
To purchase the NB commercial paper, an intending investor must have a minimum of N5 million, which is the lowest subscription.
Nigerian Breweries is a leader in its sector in Nigeria, boasting over 21 distinct brands that are doing well in their subsectors. The company also has a good market spread in the beer, spirit, and non-alcoholic market segments.
