Dufil Prima Nigeria, makers of Indomie Noodles said it is looking to raise about USD131 million via a debt issuance programme.
The debt issuance will be done in the local debt market to broaden its funding base, according to a statement issued by the company.
Early last quarter, Dufil announced it will buy Dangote Noodles and phase out the latter’s brands in the next three years.
Dufil Chief Operating Officer Madhukar Khetan said tracked by Reuters that the issue has been approved by the Securities and Exchange Commission but that the timing of the sale was subject to market conditions.
Dufil said it has appointed Stanbic IBTC Capital, the local unit of South Africa’s Standard Bank to arrange the debt.
Recalling the Dangote Noodles acquisition, Thabo Mabo, said the divestment is part of the strategic moves of Dangote Flour Mills to focus on its core pasta production activities, an area where the company has an upper hand.
Indomie is the largest maker of noodles in Nigeria with over 60% market share across the country. The acquisition of Dangote Noodles is expected to push its share of market to nearly 80%.
Confirming the deal, the Chief Executive Officer, Dufil Prima Foods, Deepak Singhal said the acquisition has been perfected to involve the entire asset of the company. Dufil will also be retaining substantial employees of Dangote Noodles while others will be paid off based on a negotiation with the workers union.
Dufil is not a public company and as such, the company will not reveal how much it paid for the acquisition. However, Dangote Flour Mills is expected to state the amount in its first quarter earnings result which is expected in few weeks from now.