Dufil Prima Foods Plc issues N10bn Series 1, under N40bn bond programme

Following the establishment of its N40 billion Bond Issuance Programme in July 2017, Dufil Prima Foods Plc, has successfully issued its inaugural Series 1 of N10bn bond under the programme.

The Series 1 issuance achieved a 100 per cent subscription level with participation from a wide array of domestic (Pension Fund Administrator, Fund Managers and Commercial Banks) and foreign investors. The Series 1 bond was issued at a fixed coupon rate of 18.25 per cent for a tenor of five (5) years, with a bullet repayment at the end of the tenor.

The proceeds of the issuance will be used to refinance existing debt obligations, and finance partial capital expenditure plans of the Company.

The debt capital market in Nigeria, increasingly offers blue chip companies with a viable alternative or complement option to finance their working capital requirements and business expansion objectives. Dufil is very pleased to have taken this additional step in cultivating its relationship with the capital markets focused institutional investor base.
This transaction represents Dufil’s debut bond issuance.

The company has previously inaugurated several short-term commercial paper issuances under its N30bn CP Programme. All the funds raised under the series has matured and been repaid.

Speaking at the signing and completion meeting for the issuance at the company’s corporate office in Lagos, Mr. Madhukar Khetan, the Chief Operating Officer for Dufil stated: “Dufil as a company operating in the Nigerian market for over two decades, is pleased to have taken this additional step in expanding and diversifying its financing options beyond the conventional commercial bank debt market by establishing relationships with non-bank institutional investors in Nigeria.

He said,Dufil Bond has received participation from both domestic and foreign Investors. In case of domestic investment, a wide range of top notch Pension Funds, Asset Managers and Banks participated. Furthermore, Dufil is also extremely pleased to have had foreign investor participation in the bond issue, as this is a testament to the company’s adherence to international best practices and standards, which the Company employs in all aspects of its business operations.

We are very pleased to have worked with our advisors, Stanbic IBTC Capital as Lead Issuing House, and FBN Capital as Co-Issuing House and other professional parties such as Nnenna Ejekam & Associates, G.Elias & Co., Udo Udoma & Bello Osagie, Deloitte, ARM Trustees, Stanbic IBTC Trustees, GCR & Co., First Registrars and PKF Professional Service, to achieve this milestone in our history.

Madhukar added; “Whilst Dufil remains Nigeria’s pioneer, foremost and largest producer within the noodles segment, as the Company has created the Instant Noodle Industry, is also well known for its other equally successful brands. Brands such as Power Oil, Minimie Chinchin, Pure Flour and Power Pasta have all originated from Dufil’s commitment to Nigeria.

Dufil has recently acquired one of its major competitors in the Instant noodle category in Nigeria and also acquired a pasta factory in Ghana, which clearly demonstrates Dufil’s leadership dominance in the FMCG Business.

Also commenting, Kobby Bentsi-Enchill, Executive Director and Head of Debt Capital Markets, for Stanbic IBTC Capital stated: “It is immensely rewarding to see more blue chip issuers emerge as frequent issuers of fixed income instruments, such as commercial paper and bonds, in the capital markets.

Over the last few years, Stanbic IBTC has tirelessly championed the resurgence of corporate debt issues in various formats, and we are exceptionally pleased to see these efforts yielding results, and more importantly for the opportunity to assist our valued clients, such as Dufil Prima Foods PLC to achieve their financing objectives. Continued innovation in the origination, structuring and issuance of debt securities can only be for the ultimate good and growth of the Nigerian capital markets.