A Nigerian indigenous company, the largest cable manufacturer in West Africa, Coleman Wires and Cables, is set to issue a N50 billion bond having concluded arrangements with the Securities and Exchange Commission (SEC).
The Managing Director of the company, George Onafowokan, disclosed this at the signing ceremony held in Lagos on Saturday.
He said bond was one of the fundamental option from the company’s portfolio of funding.
In his words; “When we looked at all the other options, going through this methodology on finance is also better for our portfolio on financial mix. Also, the way you get your average cost down is by trying to get a different set of portfolios of financial mix and instruments.
“So going the direction of the bond, getting rated, getting issued analysis and advisory companies together was a key fundamental to giving us an option on our portfolio of funding.”
According to the industrialist, the company had commenced production of some major cables including marine and transmission cables which enabled it break the barrier in terms of importation of cables adding that Coleman Wires and Cables evaluated the business thoroughly and intends to fill the gaps in Nigeria, West Africa and the entire African continent.
“For us, investment has already started. The future of the business is all about development, capacity building in areas looking at our fiber optic industry that we are now in, oil and gas where we are doing marine cable, high voltage, transmission, it is not enough yet. What we have done is to break barrier of importation of all these cables,” he said.
In his remarks, an official of the Coronation Merchants Bank, Suru Daniels, said Coleman has established an opportunity to diversify its funding through the proposed bond issuance.
“For a company that has invested significantly in manufacturing space in Nigeria, there is always a need to have adequate capital hence, the N50 billion programme will help Coleman to increase the mixed of capital that it has access to.
“One of the good things about this is that anytime within the next three years, Coleman is able to access the capital market obviously at a preferred interest rate. What this does for both Coleman and the market is that the company’s capacity utilisation can be optimised, because it is not likely to be hindered by working capital market related challenges.” Daniels said.