Flour Mill of Nigeria Leverages Strong Credit Rating to Secure Capital Market Funding

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Flour Mill of Nigeria Plc, a prominent consumer conglomerate in Nigeria, has reaffirmed its commitment to utilizing its impressive credit rating to raise funds from the capital market. With a solid financial standing and a strong brand reputation, the company controls a significant market share across its business divisions and actively participates in the debt capital market.

The Group, known for its timely repayment at maturity, aims to optimize its funding costs by tapping into the market for its Series 3 Commercial Paper. In June 2023, it launched the Series 3, which received an overwhelming response from the investing public, recording N144.37 billion in bids, representing a remarkable oversubscription of 262 percent. The order book attracted diverse investor classes, with notable participation from banks (39.8 percent) and Pension Fund Administrators (40.8 percent).

The initial tranche of the Series 3 Commercial Paper raised N55 billion at a 239-day maturity, fulfilling the company’s working capital requirements. The Group plans to launch a second tranche to establish a structured repayment pattern.

Mr. Titus Owoeye, the Director of Group Treasury and Investor Relations at FMN, highlighted the company’s creditworthiness, strong brand value, and long-standing success in driving local content development and investment across its value chain. FMN’s revenue surpassed N1 trillion in 2022, placing it among the select group of Nigerian companies achieving this milestone. The company’s backward integration program has also significantly contributed to its growth in both top-line and bottom-line performance.

Opinion: Flour Mill of Nigeria’s ability to its impressive credit rating to raise funds from the capital market reflects its robust financial position and strong reputation. The overwhelming response to the Series 3 Commercial Paper highlights the confidence investors have in the company. FMN’s focus on local content development and investment, as well as its success in the FMCG and agribusiness sector, positions it as a key player in Nigeria’s economy. The company’s commitment to optimizing funding costs and ensuring timely repayments further reinforces its credibility and sustainability.


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