Flour Mills of Nigeria plc has floated ₦4.89 billion Series 4 Tranche A and ₦25.00 billion Series 4 Tranche B Fixed Rate Bonds under its ₦70.00 billion Bond Issuance Programme on FMDQ Securities Exchange.
This decision was made after due diligence was carried out by its Board Listings and Markets Committee, a statement issued by the FMDQ on Tuesday stated.
It said this listing comes shortly on the heels of the recent Commercial Paper Issuances by Total Nigeria PLC, Valency Agro Nig. Ltd. and Mixta Real Estate Plc.
Due the disruption in the business environment and concerns of coronavirus pandemic, FMDQ said corporates across multiple sectors were re-evaluating their financing strategies by tapping the debt capital markets as a viable avenue to efficiently raise capital in order to meet their business expansion/working capital needs.
According to the company, the critical role which debt markets play in facilitating sustainable growth and development cannot be overemphasised.
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“The Nigeria debt capital market (DCM) plays an important role in the efficient mobilisation and allocation of resources in the economy and despite the impact of the current times, the market has continued to effectively support corporates looking to expand their business operations,” the statement said.
“It is in this regard that FMDQ Holdings PLC (“FMDQ Group” or “FMDQ”) in its capacity as a leading market organiser of the Nigerian DCM, amongst others, has continued to provide stakeholders in the Nigerian capital market with a credible and robust platform for capital access, risk management and transfer of value.
“As major effects of the pandemic, Nigeria has witnessed rapid inflation characterised by dwindling food security and reduced labour market participation.
“Flour Mills is strategically positioned to produce and supply products of superior quality and value to the market, thereby, enriching the lives of consumers, customers, communities, employees, and all stakeholders.”
According to Mr. Omoboyede Olusanya, Group Managing Director/Chief Executive Officer, Flour Mills of Nigeria Plc,“Flour Mills of Nigeria Plc is delighted to have successfully concluded the issuance of ₦29.89 billion Series 4 (Tranche A & B) bonds under the ₦70.00 billion bond issuance programme.
“The Bond, which coincided with our 60th anniversary celebration was strongly supported by the institutional investor community and corroborates our strategic objective of sustaining our market leadership position whilst backwardly integrating to increase the use of locally sourced materials to develop and produce unique consumer products in alignment with our mission of “Feeding the Nation, Everyday”.
“The proceeds of both bonds have been used entirely to refinance our existing commercial paper notes also successfully issued during the pandemic.”
Also commenting on the listing, Ag Managing Director, FCMB Capital Markets Limited, Abimbola Kasim, stated, “FCMB Capital Markets appreciates the opportunity given to us by the Board and Management of Flour Mills of Nigeria to act as the Lead Issuing House on its ₦29.89 billion Series 4 Bond Issuance, being the final and largest Series under the ₦70 billion Bond Issuance Programme registered in 2018.
“The success of this transaction speaks to Flour Mills’ impressive operational and financial performance, and an affirmation of this strength by investors in the bond who subscribed overwhelmingly during a low interest rate environment.
“Following this success, we expect Flour Mills and our other clients to continue to explore opportunities to raise funds from the Nigerian debt capital markets to diversify their funding sources.”
