Lafarge Africa is marketing a 60 billion naira ($302 million) bond to refinance some dollar-denominated debt at United Company of Nigeria (UNICEM), which it bought last year.
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| Lafarge factory |
Chief finance officer Anders Kristiansson told analysts on Thursday that there was strong interest for the bond and that book-building was expected to open in the second week of May.
The cement and clinker mixer said it had received approval from Nigeria's Securities and Exchange Commission (SEC) for a 100 billion naira bond, but will issue 60 billion naira for five-years.
"We are in the process of restructuring the UNICEM debt. We are in the middle of a roadshow," Kristiansson said. "We want to refinance the U.S. dollar borrowings that we have in UNICEM."
Lafarge Africa acquired control of Nigeria's third-largest cement manufacturer UNICEM last October after it bought a 30 percent stake it did not already own from rival Flour Mills for an undisclosed amount.
It reported first-quarter loss before tax of 2.22 billion naira on Thursday and said debt at UNICEM rose to 152.4 billion naira as of the first quarter, compared with 145 billion naira in the same period of last year.
The local unit of the world's biggest cement maker, LafargeHolcim, expects to use the proceeds of the 60 billion naira bond to repay some of UNICEM's borrowings, including a $300 million loan from the parent company, the CFO said.
Kristiansson said Lafarge Africa was paying an interest rate of between 16 to 18 percent on its domestic loans but was hoping to reduce it by about 4 to 5 percentage points with the bond issue. Final pricing will depend on what investors are willing to pay, he said.
*First published by Reuters
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