capital market
Dangote floats N300bn bonds on NGX, FMDQ to finance refinery project
Dangote Industries Limited (DIL) has formally listed its N300 billion Series 1 and 2 bonds issued under the Dangote Industries Funding Plc at a grand listing ceremony at both the FMDQ and the Nigeria Exchange Limited (NGX) in Lagos.
The Group Managing Director of Dangote Industries Limited, Olakunle Alake told investors during the listing ceremony that the bonds were primarily for part-financing the Group’s 650,000 bpd refinery project.
He explained that the decision of the Company to issue bonds to raise the required capital for part-financing the refinery project was to encourage the participation of Nigerians in the financing of the project.
He noted that the bonds remain the largest aggregate local currency bond issuance within a calendar year by any corporate organisation in the history of the capital markets.
Alake said the bond is to tap the local capital markets considering the sheer scale of the project being developed.
He said that while the Dangote Group is not new at raising funds in the local capital markets, being a first-time issuer at the holding company level presented a fresh challenge for the Company.
However, the challenge was one the management was willing to embrace to ensure the desired outcome was achieved.
According to him, “Today, we are delighted to have completed the largest aggregate local currency bond issuance by a corporate in the Nigerian capital markets within a calendar year.
“The proceeds from the Series 1 and 2 bond issuances were dedicated to part-financing the Dangote Petroleum Refinery Project which is the initiative by the Group to establish an Integrated Petrochemical Complex, and the largest Single Train Petroleum Refinery in the World.”
Alake recalled that the DIL recorded another first through the N187 billion series 1 bonds (under the N300 billion program), being the largest corporate bond ever issued in the history of the Nigerian capital markets and the management was pleased to have set the remarkable milestones, showcasing the depth, resilience and liquidity of the domestic capital markets, whilst reflecting the strong credit quality of the issuer, despite the current global market volatility.
He said, “The bonds issuances were well received by the market and recorded participation from a wide range of investors including domestic pension funds, asset managers, insurance companies, and high net-worth investors.
“Indeed, the reception of the market was buoyed by the strategic importance of the project and its expected impact on the Nigerian economy. Overall, we strongly believe the success of the Series 1 and 2 bond issuances further demonstrates investor confidence in our credit story and the appreciation of the work done by the Group across several key sectors that are crucial to the development of Nigeria and the continent at large.”
Alake pointed out that his Company was not new in the business of listing securities on NGX.
“We are therefore conversant with all the listing requirements and promise to be prompt and up to date in that regard. We count on the cooperation and support of NGX and the stockbrokers to meet this important investors’ objective.”
The DIL Group Managing Director assured that the company would remain resolute in the Nigerian and African story and continue to demonstrate commitment, as one of the foremost pan-African conglomerates, through investments in projects and initiatives that directly improve the quality of lives of Nigerians.
“Indeed, these are very exciting times for us as a business, and so we would continue to welcome opportunities to work with stakeholders in the domestic capital markets towards accelerating the economic activities across Africa, whilst maximizing stakeholder returns.”
Also speaking at the event, the lead Issuing House for series 1 of the bonds and the Chief Executive Officer, of Standard Chartered Capital & Advisory Nigeria Limited, Yemisi Deji-Bejide, expressed appreciation of her organisation to the management of the DIL for reposing so much confidence in Standard Chartered by entrusting it with the responsibility.
She said, “Every time we gather at FMDQ for the listing ceremony of an issuance by the Dangote Group, it is always a record milestone.
“Early in 2022, we issued a bond for Dangote Cement which was the largest corporate bond issuance at the time, and little did we know that a few months down the line, the Group will comfortably break that record.”
Deji-Bejide described the success of the transaction as a strong testament to the fact that Investors strongly believe in Dangote Group’s credit story and are willing to continue to support the growth of the business.
Also, she said it demonstrated the depth of the Nigerian capital markets and resilience, despite all the volatility in the global markets and the macro headwinds.
“Lastly and most importantly, investors are keen to support impactful infrastructure projects in Nigeria, as the proceeds of the bond are being used to fund the largest single train refinery in the world,” Deji-Bejide added.
Meanwhile, at the Nigeria Exchange Limited where the symbolic gong ceremony was held to commemorate the listing, the Group Managing Director for DIL, Alake, who was represented by the DIL Group Chief Finance Officer, Mustapha Ibrahim thanked the investor community for their support for the transaction as well as various advisors and stakeholders.
He also commended the Nigeria Exchange Limited (NGX) for its unwavering support throughout this entire process of issuing and listing the bonds as well as their continued commitment towards deepening the Nigerian capital markets.
The Federal Government has listed its April 2024 Savings Bonds worth N4.214 billion on the Nigerian Exchange Limited platform.
This was disclosed in the market bulletin signed by Godstime Iwenekhai, Head, Issuers Regulation Department of NGX.
According to the bulletin, “Trading License Holders are hereby notified that the April 2024 Issue of the Federal Government of Nigeria (FGN) Savings Bonds was listed on Nigerian Exchange Limited (NGX) on May 13, 2024.”
Details of the Bonds include FGS April 2026, 1.228 million units valued at N1.228 billion at a coupon rate of 17.046 percent, while FGS April 2027, 2.986 million units amounted to N2.986 billion at a coupon rate of 18.046 percent.
The bonds are backed by the full faith and credit of the Federal Government of Nigeria and charged upon the general assets of Nigeria, according to the debt office.
FGN Savings Bond is issued monthly in tenors of two and three years with quarterly payment of coupons (interest) at a rate predetermined and published by the DMO every month.
The retail savings bond product was introduced by the Debt Management Office (DMO) on behalf of the Federal Government in 2017 to democratise its activities in the bond market by making it easily accessible to Nigerians to ensure continuous development of the domestic market and bridge infrastructure deficit which has been a constraint to economic growth.
As part of its capacity building functions, Lagos Commodities and Futures Exchange (LCFE), has onboarded and inducted another 23 Commodities Brokers, the fourth edition in the series, to increase the number of professionals to specialise in various asset classes in the Nigerian commodities ecosystem.
On the list of those inducted last week were the Managing Director, Dynamic Portfolio Limited, Mr Remi Lasaki and many Chief Executive Officers of stockbroking companies in Nigeria.
In his welcome address, LCFE’s Managing Director and Chief Executive Officer, Mr Akin Akeredolu-Ale, urged the inductees join hands with The Exchange to build a virile commodities market that shall be beneficial to all.
“LCFE is working hard to build a market that will benefit the entire Capital Market and its brokers. Each broker can select a commodity and dedicate their focus on it, thereby enhancing your company’s wealth, your individual skill set and contributing to the growth of the Nigerian Economy.
“Together, let us seize this opportunity to build a vibrant and dynamic marketplace that unlocks new possibilities for investors, enhances economic prosperity, and positions Nigeria as a leader in commodities trading.
“The Exchange is actively engaging with the Securities and Exchange Commission to obtain approval for more products like Lithium, diamond and Oil and Gas commodities. Just yesterday, we signed an MOU with a Global Certification Agent Bureau Veritas to certify lithium and other Solid Mineral commodities to be traded on LCFE. Additionally, we have made significant strides in the Cashew ecosystem, signing an MOU with the Cashew Association of Nigeria (CAN), aggregators, and a major cashew processor.
“Eko Gold also represents a pioneering investment opportunity within our commodities ecosystem, leveraging stability and transparency to diversify options, attract capital, and create value across the value chain. LCFE is fully committed to supporting its growth and providing brokers with the tools and guidance needed for effective promotion of the asset classes,” said Akeredolu-Ale.
Corroborating him, the Chairman, Securities Dealing Houses of Nigeria (ASHON), Mr Sam Onukwue, noted LCFE was established for total transformation of commodities exchanges in Nigeria and boost the country’s Gross Domestic Product (GDP).
“The underpinning drive for establishing the exchange was the need to transform and reposition the commodities market and harness opportunities in the commodities ecosystem. This drive will enhance and crate value for all stakeholders in the ecosystem,” he said.
The newly elected President of Chartered Institute of Stockbrokers (CIS), Mr Oluropo Dada, congratulated the inductees and advised them to uphold the ethical standard of the profession and operate with skills and integrity.
Akeredolu-Ale also congratulated the new board and management of Securities and Exchange Commission (SEC), under the new Director General, Dr Emomotimi Agada.
In July last year, the Pan African Exchange inducted 33 commodities brokers, including the first female office holder at Chartered Institute of Stockbrokers (CIS), Mrs Fiona Ahimie.
President Bola Tinubu has asked the Senate to screen and confirm four persons appointed as board members of the Securities and Exchange Commission (SEC), the apex regulator of Nigeria’s Capital Market.
The President’s request was contained in a letter read by the Senate President, Godswill Akpabio during the plenary on Wednesday.
The appointed members of the SEC are Emomotimi Agama, Frana Chukwuogor, Bola Ajomale and Samiya Hassan-Usman.
While Agama was appointed as Director-General, Mr Chukwuogor will serve as Executive Commissioner (Legal and Enforcement) of the Security and Exchange Commission. Ajomale was appointed as Executive Commissioner (Operations) while Hassan-Usman was appointed as Executive Commissioner (Corporate Services).
In April, President Tinubu approved the appointment of seven persons as members of the SEC pending their confirmations by the Senate. But, only four names were transmitted to the Senate for confirmation and Tinubu did not give reasons for not including the names of the other three professionals.
In the letter, the President explained that the appointment complied with the provisions of section (1) of the Investment and Security Act of 2007.
“Confirmation of appointment of the Director-General and Commissioners of the Securities and Exchange Commission.
“By the provision of sections 3 and 5 (1) of theInvestment and Securities Act 2007. I am pleased to present for confirmation by the Senate the under-listed four nominees as Director-General and Commissioners of Securities and Exchange Commission,” he said.
The president urged the lawmakers to expedite the screening and confirmation process.
The Senate President thereafter referred the request to the Senate Committee on Capital Markets to report back to the Senate within two weeks.
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