Olakunle Alake, Group Managing Director of Dangote Industries Limited 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 remains the largest aggregate local currency bond issuance within a calendar year by any corporate organization in the history of the capital markets. . 

Mr. Alake noted that following very rigorous internal assessment, the management concluded that tapping the local capital markets was inevitable, considering the sheer scale of the project being developed, as well as the existing market volatility. 

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 successfully 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 programme), 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, Mrs. Yemisi Deji-Bejide, expressed appreciation of her organization 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. 

Mrs. 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”, Mrs. 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, Mr. Alake, who was represented by the DIL Group 

Chief Finance Officer, Mallam Mustapha Ibrahim thanked the investor community for their support for the transaction as well as our 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 post Dangote Lists N300bn Series 1 And 2 Largest Bonds On NGX, FMDQ appeared first on Business News in Nigeria.

With the decline of economic activities in the country, financial experts like Prof. Uche Uwaleke, a professor of Capital Market at the Nasarawa State University, Owoturo Seyi, the President of the Institute of Capital Market Registrars amongst others have come in separate interviews to proffer solution to Nigeria’s economic crisis caused by the coronavirus pandemic.

According to the experts, the federal government must address insecurity and continuously improve the ease of doing business in the country

Uwaleke said: “CBN should consider scaling up its development finance efforts, especially as they relate to the agricultural value chain.”

In the same vein, he advised companies to leverage RegTech and research to proactively stay ahead of the market.

He stated: “In Nigeria, the containment of COVID-19 and the unlikely possibility of another lockdown will further boost the market. Exchange rate unification will likely improve foreign investments and forex market liquidity. Ongoing Stock Exchange demutualization to improve capital raising ability for infrastructure modernization.

“Finance Bill 2021 provision on unclaimed dividends (S.39) has potential to address the issue and boost market confidence, planned reopening of the borders will reduce inflation rate, planned introduction of financial Derivatives in the capital market to mitigate volatility.”

He however called on the federal government to partially privatise the Nigerian Commodity Exchange and policies to support the commodity trading ecosystem, pursue aggressive export-based diversification to reduce vulnerabilities to external shocks and boost external reserves and also address infrastructure gaps through public-private partnership.

Without mincing words, the Vice President of the Market Architecture, FMDQ Securities Exchange, Jumoke Olaniyan, pointed out signs why the government needs  make effort to ensure that the economic crises ends before the first quarter of 2021.

She said: “What we have seen in recent times is that we have seen that the Nigerian economy can be very resilient and which is very critical or the foundation of any capital market.

“It is a situation whereby a capital market can be created to absorb the shock that it goes through and always recover quickly. Therefore, it is very good that there are indicators that we will recover in the first quarter of 2021 and that is testament to the resilience of the economy itself.

“This means we have a very strong foundation but we really need to put building blocks to effect to make sure that we achieve that quick recovery and maintain that quick recovery in all facets of the economy.”

Also, the president of the Institute of Capital Market Registrars, Owoturo Seyi advised the federal government to take a step back at the Nigeria’s economic and review new ways of balancing the effect of inflation on real returns of investments in the capital market.

The post How Buhari Can Tackle Nigeria’s Economic Situation – Experts appeared first on Business News in Nigeria.