Coleman Technical Industries Opens Series 13 & 14 Up to ₦10Bn Commercial Paper Issuance

Image Credit: FSDH Capital

March 18, 2024/FSDH Capital

FSDH Capital Limited is pleased to inform you that the Series 13 & 14 Commercial Paper (“CP”) of Coleman Technical Industries Limited (“CTIL” or “Coleman” or the “Company”) of up to ₦10 Billion under its ₦30 billion Commercial Paper Programme (the “Programme”) is NOW OPEN and scheduled to close on Friday, 22nd March 2024.

Coleman Technical Industries Limited is a 100% indigenously owned private limited liability company established on July 1, 1975. The company’s primary focus is the manufacturing of electrical wires and cables that meet international standards for various industries such as power, oil and gas, real estate, and infrastructure. From inception, Coleman has been dedicated to developing local industries that create employment opportunities through the production of high-quality products. Over the course of its 47 years of operations, Coleman has become the largest producer of cables and wires in West Africa, solidifying its position as the industry leader in Nigeria. This achievement is attributed to its strong management team, which boasts over 150 years of combined industry experience.

In 2022, the company commissioned its fibre optic production line, Arepo III Project, valued at US$70 million positioning Nigeria as the fifth-largest producer of fibre-optic cables in Africa which continues to support the drive of the digital economy in the West African region. With a production capacity of 162,000 metric tons per annum, this factory enables Coleman to actively participate in the African Continental Free Trade Area (“AfCFTA”), leading to increased earnings, foreign exchange conservation, technology transfer, and the generation of direct and indirect employment opportunities for the local population.

The resurgence in the oil and gas sector and the drive for local content has also become a catalyst for Coleman’s growth. This is evident from the contract of US$65million annually secured by Coleman for the supply of cables to the Nigeria LNG Limited (NLNG) US$10billion project for five (5) years ending in 2027. The contract spans across multiple products including instrumentation cables, fibre-optic cables, low and heavy-duty electrical cables.

Subsequently, Coleman has embarked on a backward integration project with the construction of a copper and aluminum smelter plant (Sagamu III Project) to minimise its exposure to raw material supply and foreign exchange risks.  

Coleman holds a long-term issuer rating of “BBB-” by GCR Ratings and “Bbb” by Agusto & Co. These ratings are supported by the company’s well-established market niche, diverse product portfolio, stable earnings, and cash flows. CTIL, has sustained a consistent string of financial successes in their FY 2023 management figures, with revenue increasing by 38% Y-o-Y to ₦54.15 billion, profit before tax growing by 103% Y-o-Y to ₦13.72 billion, and total assets growing by 80% Y-o-Y to ₦113.4 billion as of the end of FY 2023 (Management). The company’s return on equity for FY 2023 was 50%, highlighting its strong value creation for shareholders. As part of its strategic funding initiative, Coleman is seeking to raise working capital to support its short-term working capital requirements.

Key Financial Highlights

Please see indicative terms of the Commercial Paper Issuance below: 

For more information on the Offer, please refer to the offer documents listed below, which can be accessed through this link

  1. Programme Memorandum
  2. Series 13 & 14 Commitment Forms
  3. Series 13 & 14 Pricing Supplements
  4. CTIL Audited Financial Statements (2017 – 2022)
  5. FY 2023 Management Accounts
  6. Issuer’s rating reports by Agusto and GCR
  7. Valid PenCom Compliance Certificate

Leave a Comment

Your email address will not be published. Required fields are marked *