Dangote Sugar Refinery Plc has commenced a major capital raise valued at N485.9 billion as the company intensifies efforts to strengthen its financial position and accelerate expansion across Nigeria’s sugar industry.
The rights issue, which forms part of a broader N500 billion fundraising programme already approved by shareholders, will see the company offer 8.09 billion ordinary shares at N60 each to existing investors.
Under the arrangement, shareholders who held shares in the company as of April 20 will be entitled to purchase two new ordinary shares for every three shares already owned.
The move is widely seen as a strategic step by the company to improve liquidity, reduce debt pressure, and position itself for long-term growth amid rising operational and foreign exchange costs.
Dangote Sugar Refinery Plc, a subsidiary of Dangote Industries Limited, is one of the largest players in Nigeria’s agro-industrial sector, with operations spanning sugar refining, distribution, and marketing to major manufacturers in the food, beverage, pharmaceutical, and personal care industries.
At the core of the fundraising drive is the company’s ambitious “Sugar for Nigeria” project, a backward integration initiative designed to boost local sugar production and reduce dependence on imports.
According to the company, proceeds from the rights issue will support plans to achieve a domestic sugar production target of 1.5 million metric tonnes annually, while also funding key infrastructure projects, refinery upgrades, and the development of new greenfield sites.
The company also intends to use part of the proceeds to ease finance-related pressures that weighed heavily on previous earnings, particularly high borrowing costs and exposure to foreign exchange volatility.
Dangote Sugar currently operates what is regarded as the largest sugar refinery in Sub-Saharan Africa, with an installed refining capacity of approximately 1.49 million metric tonnes per annum.
Through its ongoing backward integration strategy, the firm is pushing to produce an additional 1.5 million metric tonnes of locally sourced sugar, a move expected to strengthen its standing as one of Africa’s leading integrated sugar producers.
Industry analysts say the fundraising could provide the financial flexibility needed for the company to scale production, deepen local sourcing, and improve shareholder value over the long term.
The rights issue is scheduled to close on June 24.
A company statement noted that the offer is specifically aimed at “reducing the Company’s leverage position, improving liquidity, and enhancing its capital structure to support long-term sustainability and shareholder value creation.”