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Dangote Cement Mulls Raising Issuing Bonds Under Its N300bn Debt Program



Dangote Cement - Investors King

Nigeria’s leading cement manufacturing company Dangote Cement announced it has received approval from the Securities and Exchange Commission to raise fresh funds under its N300 billion debt issuance program.

Dangote cement disclosed this in a statement signed by Edward Imoedemhe, Deputy Company Secretary and obtained by Investors King.

The cement manufacturing company the money to expand operations and finance existing short-term debt.

The statement reads “Dangote Cement PLC (the “Company”) has obtained approval from its Board of Directors to access the Capital Markets for medium to long-term debt funding.

“The Company had submitted an application to the Securities and Exchange Commission in respect of the bonds, and relevant approvals have now been received. The bonds will be issued imminently, subject to favourable market conditions.

“The Company’s management has disclosed that the proceeds of the bonds will be applied towards funding expansion projects, refinance existing short-term debt and for general corporate purposes.”

Is the CEO/Founder of Investors King Limited. A proven foreign exchange research analyst and a published author on Yahoo Finance, Nasdaq,, Investorplace, and many more. He has over two decades of experience in global financial markets.

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Global Bonds Surge at Swiftest Pace Since 2008 Crisis as Rate Hike Speculations Subside



Bonds- Investors King

Global bonds are experiencing their most rapid surge since the 2008 financial crisis, with a Bloomberg measure of global sovereign and corporate debt returning 4.9% in November.

This marks the largest monthly gain since December 2008 when it soared 6.2% during the depths of the recession.

The surge is fueled by growing speculation that central banks, led by the Federal Reserve, have completed interest rate hikes and are poised to initiate cuts in the coming year.

The recent rally has been accentuated by comments from Fed Governor Christopher Waller, signaling a dovish stance. James Wilson, a senior portfolio manager, noted the significance of Waller’s dovish remarks, stating, “It sounds like the Fed is all but done in their hiking cycle.”

US 10-year yields slid to 4.26%, and Australian bonds experienced a surge, with 10-year yields dropping 14 basis points.

The current bond rally reflects a shift in expectations towards looser central bank policies, providing relief for corporate bonds.

Spreads on global investment-grade corporate debt are hovering near the lowest levels since April 2022, indicating increased investor optimism about a gentle economic slowdown.

The average yield on corporate bonds has retreated to around 5.3%, down from nearly 6% in October, according to Bloomberg data.

Despite this positive trend, there remains a divergence in views between credit investors and rates traders, with the latter anticipating more aggressive Fed rate cuts that would necessitate a more pronounced economic deceleration.

The resolution of this tension is likely to be a focal point as central banks navigate economic uncertainties in the months ahead.

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Uber Boosts Convertible Bond Issue to $1.5 Billion Amidst Strong Investor Demand




Ride-hailing giant Uber Technologies Inc. has increased its planned convertible bond issue to $1.5 billion, highlighting robust demand among investors.

The move comes as Uber prices the issue with a 0.875% coupon, nearing the lower end of the marketed range. The conversion premium is set at 32.5%, positioned at the top of the range.

Uber’s initial plan was to raise $1.2 billion with a coupon range of 0.75% to 1.25% and a conversion premium of 27.5% to 32.5%.

The decision to upsize the offering indicates strong investor interest. The company’s representative has not yet responded to requests for comments.

This successful share sale follows Uber’s notable 27% share-price surge since the end of October and its better-than-expected third-quarter earnings.

The move to tap into the convertible bond market is opportune for Uber, with a market value of $113 billion, making it the largest company to enter the convertible bond market this year.

The favorable pricing is attributed to Uber’s impressive performance, with two consecutive profitable quarters reported.

This move capitalizes on the positive market sentiment and a decline in interest rates, reflecting the belief that the Federal Reserve’s rate hike cycle has concluded.

Upon the deal’s closure, Uber’s improved credit outlook will enhance its ability to raise additional financing in the current interest rate environment.

The proceeds will be used to redeem $1 billion in outstanding 2025 notes carrying a 7.5% coupon, further strengthening the company’s financial position.

Bloomberg Intelligence senior credit analyst Robert Schiffman noted that while potential upgrades to Uber’s ratings may be more biased towards 2025, positive developments seem inevitable.

Uber’s liquidity, access to low-cost capital, and improving fundamentals position the company for credit rating upgrades over the next 12 to 24 months.

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Improved Demand at the Latest Bond Auction – Coronation Economic Note



Bonds- Investors King

The Debt Management Office (DMO) held its monthly auction of FGN Bonds on Monday (16 October ’23). It offered N360bn but raised N334.8bn through re-openings of 14.55% FGN APR 2029, 14.70% FGN JUN 2023, 15.45% FGN JUN 2038, and 15.70% FGN JUN 2053 bonds.

The participation level (demand) at this auction increased by 31.7% m/m to N383.1bn compared with N290.9bn recorded in September ’23. The bids for the 10, 10, 15, 30-year benchmarks were allotted at the marginal rates of 14.90%, 15.75%, 15.80%, and 16.60% respectively.

The bid-to-cover ratio stood at 1.2x.

The demand at this auction reflects improved system liquidity. This is in sharp contrast with September’s bond offering which recorded a relatively lower subscription of N290.9bn.

Inflows from FGN bond coupon payments, NTB maturity, and FAAC payout within the period boosted system liquidity as it outweighed outflows from NTB auctions. We note that market liquidity stood at N448.8bn while call, overnight and repo rates closed within the range of 1% – 6% as money market rates moderated on Friday (13 October ’23; i.e., the previous working day before the auction).

Looking ahead, we expect relatively healthy system liquidity in the coming months (November and December 2023) largely due to inflows from FGN bond coupon payments and NTB maturities. Based on our estimates, these maturities and coupon payments collectively amount to N1.2trn.

We note that demand was significant for the longer-tenure bonds (JUN 2038 and 2053 bonds) given their attractive yields (15.80% and 16.60% respectively). However, negative real interest rates (currently -7.95%) due to elevated inflation continue to dampen investor’s sentiments toward investing in FGN bond instruments.

The latest inflation report by the NBS shows September’s headline inflation increased by +92bps to 26.70% y/y. We understand that the new CBN Governor has not ruled out further rate hikes as a mechanism for combating inflationary pressures. Another moderate rate hike in the near-term is not far-fetched.

Domestic institutions remained the core participants at this bond auction. According to the latest monthly report released by Nigeria’s Pension Commission (PENCOM), the assets under management (AUM) of the pension industry increased by 18.7% y/y and 1.8% m/m to N17.1trn in July ‘23. FGN bonds accounted for 62.8% of total assets under management.

The DMO is set to raise a maximum of N4.8trn in FY 2023 through FGN bond issuances.

However, YTD, it has raised N4.6trn (meeting 95.8% of its target). Overall, we maintain our stance that the FGN is likely to exceed its domestic borrowing target of N7.04trn by end2023.

In a separate report, the DMO disclosed that it offered N150bn but raised N350bn through the issuance of its sixth Sovereign Sukuk Bond. The interest rate for the 10-year instrument was pegged at 15.75% per annum.

We note that the bond was oversubscribed as demand stood at N652.8bn. According to the DMO, the funds raised would be channeled towards the construction and rehabilitation of critical infrastructure projects such as roads and bridges across the country.

Over the next one month, we see mid-curve FGN bond yields in the secondary market around 14.9% – 15.5% at the short-end of the curve and yields at the longer-end of the curve between 15.0% – 16.5%

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