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After raising about N25 billion from its Series 1 & 2 Commercial Paper (CP) issuance in May, Africa’s largest electrical wires and cable maker Coleman Technical Industries Limited has returned to the market, targeting to raise N50billion this time from Series 3 & 4 CP issuance.
The Series 3 & 4 CP issuance, which is under its N100 billion Commercial Paper programme will close on Wednesday July 2, 2025. The CP issuance opened on Thursday June 26.
Commercial papers (CPs), long favoured by large corporations and institutional investors, are now gaining traction in Nigeria and other emerging markets as savvy individuals and businesses seek more effective ways to manage idle cash.
With the potential for significantly higher short-term returns compared to traditional options like savings accounts or fixed deposits, CPs are becoming a compelling component of modern investment strategies.
Commercial Papers (CPs) are unsecured, short-term debt instruments issued by credit-worthy companies to meet immediate financial obligations such as operating expenses or supplier payments. Instead of securing loans from banks, companies raise funds directly from investors by issuing CPs, typically for tenors ranging from 15 to 270 days.
Coleman Technical Industries Limited is issuing the 180 days Series 3 Commercial papers at an implied yield of 23 percent, while the 270 days Series 4 Commercial papers is issued at an implied yield of 24.75percent.
Commercial Papers are typically issued (or sold) at a discount and redeemed (or repaid) at face value upon maturity. Increasingly accessible to retail investors via licensed investment platforms, CPs offer a competitive alternative for individuals and institutions seeking higher yields without long-term commitments.
Read also: Coleman, West Africa largest cables producer shops for N25bn from Series 1 & 2 CP issuance
Coleman Technical Industries 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. As part of its strategic funding initiative, Coleman is seeking to raise working capital to support its short-term working capital requirements.
The company in 2022 commissioned its fibre optic production line, the Arepo III Project, valued at $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.
Coleman Technical Industries Limited is a 100 percent indigenously owned private limited liability company established on July 1, 1975.
Coleman Technical Industries Limited has sustained trend of financial successes as evidenced in its 2024 financial result where its revenue increased by 154 percent year-on-year (YoY) to N137.73 billion, net income grew by 111 percent YoY to N31.08 billion, and total assets grew by 30 percent to N147.78 billion as of the end of FY 2024.
The company significantly reduced its leverage position, with total borrowings declining by 49 percent from N44.93 billion in 2023 to N22.91 billion in 2024, further underscoring its strong financial standing.
While Commercial Papers are not backed by collateral, they are anchored on the issuer’s credit rating and reputation. Coleman holds a long-term issuer rating of “A-” by GCR Ratings and “A-” by Agusto & Co. These ratings are supported by the company’s well-established market niche, diverse product portfolio, stable earnings, and cash flows.
From inception, Coleman has been dedicated to developing local industries that create employment opportunities through the production of high-quality products. For 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.
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 have also become a catalyst for Coleman’s growth. This is evident from the contract of $65million annually secured by Coleman for the supply of cables to the Nigeria LNG Limited (NLNG) $10billion project for five (5) years ending in 2027. The contract spans multiple products, including instrumentation cables, fibre-optic cables, and low and heavy-duty electrical cables.
Coleman has embarked on a backwards integration project with the construction of a copper and aluminium smelter plant (Sagamu III Project) to minimise its exposure to raw material supply and foreign exchange risks.
