Dangote Cement to raise debt for expansion, refinance needs under N300 billion programme

Dangote Cement is on course to approach the capital market to raise new debt through bonds after its board agreed to the move, aimed at financing its operations and some expansion projects, Nigeria’s second biggest company by market capitalisation said Wednesday.

The cement giant said it would first observe market conditions closely to know the right time for entry even though it assured the bonds will be issued soon.

“The Company had submitted an application to the Securities and Exchange Commission in respect of the bonds, and relevant approvals have now been received,” Dangote Cement said in a regulatory filing seen by PREMIUM TIMES.

Last May, the firm issued N50 billion Series 1 Fixed Rate Senior Unsecured Notes with varying coupon rates of 11.25, 12.50 and 13.50 per cent for the three, five and seven year tranches in that order under its N300 billion multi-instrument debt issuance programme.

The capital was planned to facilitate Dangote Cement’s export strategy across Africa, where it operates in 10 markets.

It raised in August debt worth N150 billion by way of commercial paper to meet obligations including working capital and “general corporate purposes,” bringing the total so far issued to N200 billion.

No mention has been made of how much it will source this time around. Part of the new capital will go to refinancing “existing short-term debt and for general corporate purposes.”

“Dangote Cement has issued an aggregate of ₦450 billion in Commercial Papers since 2018,” Chief Executive Officer Michel Puchercos said in a press release in 2021.

Dangote Cement, Africa’s biggest cement-maker with a nameplate capacity of 48.6 million tonnes per year, reported an almost one-third jump in profit to N364.4 trillion last year as sales touched a record N1.4 trillion.

Its share price closed at N273.50 on Lagos Customs Street on Wednesday recording no movement.