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Flour Mills to raise N20 billion through bond offering

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Olam makes advances to acquire Dangote Flour Mill for N130bn

Food company, Flour Mills of Nigeria Plc, has announced the issuance of N20 billion “in medium terms bonds subject to appropriate pricing.”

The firm made the disclosure in its notification to the Nigerian Stock Exchange (NSE) Thursday, signed by Joseph A.O Umolu, its Company Secretary/Director, Legal Services.

The corporate bond is the latest tranche in its N70 billion bond issuance programme, the firm said.

With tenors of 3 and 5 years, the bonds anticipated to be Senior Unsecured Fixed Rate Bonds. The process of securing regulatory approval from the Securities and Exchange Commission (SEC) for the capital-raising exercise is under way.

The firm intends to channel the capital raised through the offering into refinancing its short-term debt obligation and ramp up the efficiency of its balance sheet. The idea is to maximise the wealth of its shareholders.

Read also: Nigerian govt risks poor implementation of 2020 budget as oil output slumps

The participation of corporate organisations in the bond market last year was massive and that momentum is expected to be sustained this year. Oscar Onyema, the NSE chief, while speaking in Lagos on Monday on the performance of the market in the year that just went by said “the year 2019 saw the groundbreaking listing of Access Bank Plc’s N15 billion Green Bond, the first of its kind to be issued by an African corporate.”

“We also saw the listing of North South Power Company Limited’s N8.5Bn corporate infrastructure Green Bond, which was oversubscribed by 60 per cent, with firm commitments from twelve institutional investors including nine pension funds. “

“Capital raising by corporates increased by 321.61 per cent with a total of N132.68 billion raised in 2019.”

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