Dangote Cement PLC has announced its board’s approval to raise medium- to long-term debt funding through a new bond issuance, part of its ongoing N300 billion multi-instrument program.
This decision, disclosed in a filing to the Nigerian Exchange (NGX) on November 15, 2024, reflects the company’s strategy to enhance its financial structure and support its growing operations.
The company has obtained the necessary regulatory approvals from the Securities and Exchange Commission (SEC) to proceed with the issuance of Series 1 bonds.
These bonds are expected to be issued soon, depending on market conditions. The proceeds will be directed toward refinancing existing debt and providing additional working capital for Dangote Cement’s operations, including its expansion efforts.
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Dangote Cement’s previous bond issuances under this N300 billion program raised a total of N166 billion. In 2021, the company successfully raised N50 billion through Series 1 bonds and N116 billion through Series 2 bonds, both aimed at financing key projects, including its refinery expansion. The bonds offered various maturity periods, ranging from 3 to 10 years.
This new bond issuance marks a return to the capital markets after a 30-month hiatus. Despite Nigeria’s high interest rate environment, which has made borrowing less attractive for many companies, Dangote Cement continues to demonstrate resilience in navigating market conditions. The company previously raised N316 billion from bonds and commercial papers to support various initiatives, including working capital and debt refinancing.
In its latest financial results for the first nine months of 2024, Dangote Cement reported a 69.5% year-on-year increase in revenue, reaching N2.56 trillion. Operating profit grew by 34%, with a 2.9% rise in earnings per share.
The company’s strong performance, driven by a significant rebound in the Nigerian market, underscores its potential to leverage the upcoming bond issuance to further strengthen its position in the African cement market.
The successful issuance of these bonds is expected to provide Dangote Cement with the financial flexibility needed to maintain its leadership in the region’s cement industry while supporting its ambitious growth plans.
