Nigerian Breweries Plc (NB), on Monday, Sept. 29th, established a N100 billion Commercial Paper (“CP”) programme.
It is the largest commercial paper programme to be established in Nigeria by a (non-financial institution) corporate issuer since the 2009 guidelines on commercial paper from the Central Bank of Nigeria (CBN).
According to the company, the launch of the inaugural commercial paper issue under the programme would kick off on or before Thursday, Oct. 8th.
Commenting on the significance of the exercise, the Finance Director, Nigerian Breweries, Mark Rutten, said that “This programme is expected to complement our company’s other sources of working capital, whilst diversifying our funding sources to include non-bank investors that would provide Nigerian Breweries with additional tools to help manage and optimise its overall funding cost.”
He added that the exercise would enhance the company’s access to funding, even at rates equivalent to money market and Treasury bill yields.
“Additionally, this programme would improve our ability to periodically access funding at rates mirroring money market and Treasury bill yields, would provide Nigerian Breweries with additional tools to help manage and optimize its overall funding cost.”
The signing ceremony to mark the establishment of the programme was held at Nigerian Breweries’ head office in Lagos, and witnessed by representatives of the transaction advisors (Stanbic IBTC Capital Limited, BANWO & Ighodalo as Legal Counsel, KPMG as auditors to the issuer (for the relevant financial years under review) and Stanbic IBT Bank Plc as issuing Calculation and paying Agent. Also in attendance were officials of the FMDQ TC Exchange as witnesses to the event.
Speaking at the signing ceremony, Nicolaas Vervelde, Managing Director, Nigerian Breweries, said: “This transaction underscores our continued commitment to winning with Nigeria and represents the largest ever commercial paper programme to be established by a (non-financial institution) corporate issuer following the 2009 guidelines on commercial paper from the Central Bank of Nigeria.
In that regard, this effort clearly demonstrates our leadership status in the industry and an innovative approach towards executing our company’s financing strategy, in an increasingly competitive market environment.”