FMDQ admits Flour Mills N20.11b unsecured fixed rate bond
FMDQ or the OTC Exchange, through its board listing, markets and technology committee at the weekend, admitted the listing of the Flour Mills of Nigeria Plc’s ₦10.11 billion Series 1, and ₦10.00 billion Series 2 senior unsecured fixed rate bonds under the firm’s ₦70.00 billion bond issuance programme on its platform.
The Series 1 bonds is priced at 15.50 per cent for a tenor of three years with bullet repayment at maturity, while the Series 2 bond is priced at 16.00 per cent for a tenor of five years with a one-year moratorium on principal payment, and an amortising profile.
The proceeds of both issuance, amounting to N20.110 billion, would be deployed into refinancing Flour Mill’s existing debt obligations, and streamline its maturity profile.
The Managing Director, FMDQ, Bola Onadele, applauded the issuer for successfully raising ₦20.11 billion from the domestic capital market, noting that the Exchange has supported the enhancement of market credibility.
This, he said, has boosted investors’ confidence in the Nigerian Debt Capital Market (DCM) through transparency, and spearheading of initiatives to boost secondary market liquidity.
Onadele added that through consistent collaboration with stakeholders, the securities market would continue to further deepen and effectively position the Nigerian DCM for growth, and invariably contribute to the growth of the economy at large.
The Group Managing Director, Flour Mills, Paul Gbededo said the transaction was strongly supported by the institutional investor community, and oversubscribed by 190 per cent within the price guidance.
According to him, the transaction will help the company achieve its strategic objective of sustaining market leadership position in foods and agro-allied businesses, while fostering its vision of ‘Feeding the Nation Everyday’.
“Flour Mills of Nigeria Plc is delighted to return to the capital markets with such a successful outing, especially with the level of interest shown by investors. The response from the market vindicates the company’s decision to have taken this additional step in diversifying its financing options.
“The success of the transaction was largely due to the momentum created during very well attended investor road-show meetings in Lagos, and Abuja. The company was able to leverage on its strong credit profile and investment grade ratings assigned by two leading, well-established rating agencies.”
The Company Chairman, John G Coumantaros, expressed delight at Flour Mills’ successful return to the capital market, especially with the level of interest shown by investors.
“The response from the market vindicates the Company’s decision to have taken this additional step in diversifying our financing options.
“We are very pleased to have worked with our advisors, Stanbic IBTC Capital Limited as Lead Issuing House, along with ARM Securities Limited, FBNQuest Merchant Bank Limited, FCMB Capital Markets Limited, United Capital Plc ,and Zenith Capital Limited, as Joint-Issuing Houses, on a highly successful transaction.”