Flour Mills of Nigeria Plc has disclosed plan to raise funds through bond sale within the next two months, as part of its N70 billion ($184 million) programme to refinance its existing debt.
The company’s Group Chief Finance Officer, Anders Kristiansson, said the move was aimed at taking advantage of low money market rates, adding that Flour Mills had taken proactive measures to conserve cash in response to the coronavirus pandemic.
The company had sold N30 billion in commercial paper in April as part of measures to cushion the possible impact of the coronavirus on its business.
“We have a N70 billion bond programme. We are looking to tap into the market again given the low interest rate environment,” Reuters quoted Kristiansson to have said during an analysts’ call.
“We anticipate coming to the market to refinance some of our existing debt by bring a bond to the market. We anticipate doing that in the next two months.”
Flour Mills said it has seen steady growth in its food business and agro-business and that first-quarter revenue grew 15 per cent to N154.6 billion. The company has around N75.8 billion in net debt as at the first quarter.
Yields on short-term bills and bonds have fallen under six per cent from double digits due to excess liquidity on money markets as foreign investors dump assets to repatriate funds. The government is also providing stimulus to help businesses cushion the impact of the pandemic.