Dangote Sugar Refinery Closes Series 6 , 7 Commercial Paper Offer

Dangote Sugar Refinery (DSR) has closed its Series 6 and 7 commercial paper offerings, aimed at raising up to ₦50 billion as part of its ₦150 billion debt issuance program. This latest move follows the successful issuance of Series 4 and 5 in June 2024, which together raised ₦42.79 billion at attractive discount rates of 23 percent and 25 percent.

The Series 6 paper, with a 180-day tenor, was offered at a 24.9 percent discount rate, providing an implied yield of 28.5 percent. Meanwhile, Series 7, which has a longer 270-day tenor, was priced at a 24.55 percent discount rate, offering an implied yield of 30 percent. These offerings were open to the investing public and closed on December 12, 2024. The proceeds from these commercial papers will be directed towards enhancing the company’s working capital and supporting its long-term growth strategy, further demonstrating DSR’s commitment to utilising Nigeria’s capital markets for strategic financing.

This move builds on the success of previous issuances. In June 2024, Series 4 raised ₦12.93 billion with a 181-day tenor, and Series 5 raised ₦29.86 billion with a 265-day tenor. Across Series 1 through Series 5, Dangote Sugar has raised a total of ₦141.8 billion, highlighting strong investor confidence in its commercial paper program.

In terms of stock market performance, Dangote Sugar faced challenges in 2024, particularly in Nigeria’s industrial and consumer goods sectors. Despite an early rally in January, when stock prices surged from ₦57 to ₦67.90, the company’s stock suffered from bearish market pressure, dipping to ₦30.80 by October. However, in November, signs of recovery emerged, signalling a potential rebound and renewed investor optimism. The ongoing commercial paper issuance is expected to support the company in stabilizing operations, boosting performance, and regaining investor confidence.

With a strong commitment to operational excellence and growth, Dangote Sugar Refinery continues to leverage innovative financing solutions. The Series 6 and 7 commercial papers not only strengthen the company’s financial standing but also align with its vision to maintain leadership in Nigeria’s sugar industry. Through its well-structured debt program and improving market sentiment, the company is well-positioned to overcome challenges and seize new opportunities in the months ahead.