Dangote Cement Nigeria’s largest cement producer, has announced the establishment of a new N150 billion Commercial Paper Programme.
The cement maker said the new CP issuance allows it to broaden funding sources and, combined with an earlier N300 billion multi-instrument issuance Bond programme, increases access to capital market funding.
The Commercial Paper will be used for working capital and general corporate purposes.
Commenting on the bond issuance, Michel Puchercos, Chief Executive Officer of Dangote Cement Plc, said:
“The establishment of a new N150 billion Commercial Paper confirms Dangote Cement Plc ambition to maintain its long and successful track record of accessing the Nigerian debt capital market. Dangote Cement has issued an aggregate of N450 billion in Commercial Papers since 2018. I want to thank our stakeholders and investors who contributed to the success of all the previous issuances of the commercial paper programme. We look forward to the same warm reception as we engage with fixed income investors under this new programme. Thank you again for your continued trust in Dangote Cement.”
Commercial paper is a commonly used type of unsecured, short-term debt instrument issued by corporations, typically used for the financing of payroll, accounts payable and inventories, and meeting other short-term liabilities.
Maturities on commercial paper typically last several days, and rarely range longer than 270 days. Commercial paper is usually issued at a discount from face value and reflects prevailing market interest rates.
Dangote Cement Plc is Sub-Saharan Africa’s largest cement producer with an installed capacity of 48.6Mta across 10 African countries, inclusive of 32.3Mta in Nigeria.
The firm operates a fully integrated “quarry-to-customer” business with activities covering manufacturing, sales and distribution of cement.
Its Obajana plant in Kogi State, Nigeria, is the largest in Africa with 16.3Mta of capacity across four lines; the Ibese plant in Ogun State has four cement lines with a combined installed capacity of 12Mta, and the Gboko plant in Benue state has 4Mta.
Dangote Cement has eliminated Nigeria’s dependence on imported cement through its current investment and has transformed the nation into an exporter of cement serving neighbouring countries.
In addition, Dangote Cement has operations in Cameroon (1.5Mta clinker grinding), Congo (1.5Mta), Ghana (1.5Mta import), Ethiopia (2.5Mta), Senegal (1.5Mta), Sierra Leone (0.5Mta import), South Africa (2.8Mta), Tanzania (3.0Mta), Zambia (1.5Mta).