Promasidor Nigeria Limited, a leading food company, has secured a N5.6 billion credit from the Bank of Industry to support its aggressive expansion programmes.
PNL Finance Director, Per Kristensen, said the facility would be used for additional machinery, factory expansion and value chain development, which would create jobs for Nigerians and increase the company’s capacity to support the country’s economy.
Disclosing this in Lagos, Kristensen said the repayment of the loan was structured over a seven-year tenure, including a 12-month moratorium.
He added that the facility was a vote of confidence on the company’s untainted financial integrity, high credit rating and exceptional corporate governance practice.
He said: “The near single digit interest loan is guaranteed by First City Monument Bank Limited. You cannot compare this with any other commercial loans in the country. What this means is that Promasidor has the needed funds to pursue its growth in machinery, backward integration, production plants and create more jobs.
“The loan comes with comfort because it is denominated in local currency. For the period of seven years, the only risk is the interest rate, which is minimal. We are going to repay in Naira and the process is very transparent. We are excited about the development. It will give us additional opportunity to contribute to the growth of the country’s economy.
“The business is expanding and we need a lot of capital to support that. The injection of the BoI facility gives the management the needed stability and relief to continue to pursue the expansion plans. A lot of expansion activities are ongoing at the factory, and we will continue to see more of that in the next 24 months.”
The Promasidor Head of Legal and Corporate Communications, Andrew Enahoro, said the company and BoI had shared passion and interest in supporting job creation and the economic growth of the country.
Enahoro pointed out: “BoI’s interest is to support business expansion, stimulate jobs and create social values. These are fundamental to BoI’s support for any organisation. Promasidor, on its part, has plans to expand its different plants and develop other exciting products. These will create jobs.
“If we employ additional 500 people as a result of the credit, it is just the beginning of the impact it will create.”
He added that the company would have to look at other multiplier effects of its spending and that of the employees that would come on board on the economy as well as other indirect jobs that would be created.
Enahoro added: “Nigeria’s economy will gain. We should not forget that lower interest rate translates to lower cost of production, higher profits and more taxes. Essentially, both Nigerians and the national economy will benefit immensely from this partnership. BoI is ready to work with us to grow the economy because it has confidence in our processes and corporate governance culture.”
Promasidor, makers of Cowbell Milk, Loya Milk, Top Tea, Onga and other quality products, has engaged in an extensive factory expansion in recent times while increasing its brand portfolio.