Fitch Ratings has downgraded Dangote Industries Ltd.’s credit rating from ‘AA(nga)’ to ‘B+(nga)’. The rating agency also dropped the senior unsecured debt rating for Dangote Industries Funding Plc to ‘B+(nga)’, with both ratings placed on Rating Watch Negative. The downgrade stems from the group’s poor liquidity – the result of disposal proceeds as well as operational and financial underperformance. The group’s operational underperformance includes gas supply issues plaguing the fertilizer business and the refinery’s failure to reach full operating capacity. Its financial underperformance stems from a significant FX loss due to Nigeria’s 2023 currency devaluation. Additionally, the absence of audited accounts for 2023 and the lack of backup funding for debt maturing on August 31, 2024, influenced Fitch’s decision. However, positive rating action may follow if the group can repay or refinance its upcoming maturities and improve its liquidity position.
SOURCE: BUSINESS INSIDER
Fitch Downgrades Dangote Industries’ Rating Over Liquidity and Devaluation Issues
