Dangote Sugar Refinery Plc has launched a N485.9 billion Rights Issue to reshape its finances and power expansion plans. The offering represents most of an approved N500 billion ceiling.
Shareholders will receive two new ordinary shares for every three they hold as of April 20. Each share carries a price tag of N60.
In total, the refinery is issuing 8,097,918,827 new ordinary shares through this capital raise. Qualifying investors can subscribe based on their existing holdings.
Dangote Sugar operates Sub-Saharan Africa's largest refinery with current capacity of 1.49 million metric tonnes yearly. It refines, distributes and markets granulated sugar to food and beverage, pharmaceutical, and personal care firms.
The company plans to channel funds toward its "Sugar for Nigeria" initiative. This aims to achieve local production of 1.5 million metric tonnes annually.
Reducing debt servicing costs ranks high on management's agenda. Foreign exchange pressures have drained profits in previous years, officials acknowledged.
Infrastructure upgrades will receive significant investment from the proceeds. Both existing facilities and new greenfield sites need development.
Through backward integration, DSR intends producing another 1.5 million metric tonnes using locally sourced cane. This move strengthens its standing as a global integrated sugar player.
Subscriptions close on June 24. Management believes the capital will trim leverage ratios and shore up the balance sheet for sustainable growth.
