Dangote Refinery To Launch $1.6bn IPO

Dangote Refinery has completed the endorsement of its offer documents for its initial public offering, paving the way for the launch of its $1.6 billion public equity sale, described as Africa’s largest ever, next week.

Africa’s richest man and owner of the 700,000-barrel-per-day refinery, Aliko Dangote, led the sign-off ceremony in Lagos on Monday in the presence of advisers and other parties to the pan-African offering, which aims to raise about N2.2 trillion from investors.

Dangote said the minimum subscription for the offer is 10 ordinary shares, translating to N5,250.

Lagos-based Vetiva Advisory Services Limited is coordinating the capital raise.

The ceremony followed a key approval by the Securities and Exchange Commission last week, with 4.1 billion shares available for subscription at N525, or $0.40, per share.

The maiden share offer values the refinery at nearly $50 billion, with proceeds expected to be used to double its current capacity to 1.4 million barrels per day.

The planned expansion could increase the market capitalisation of the Nigerian Exchange by more than one-third when the shares are listed on the local bourse later this year.

The company is also working towards a cross-border listing on the Johannesburg Stock Exchange, while considering listings in Egypt, Kenya, Ghana and Rwanda.

In July, a private placement ahead of the IPO raised $2.5 billion from institutional investors and high-net-worth individuals and was oversubscribed by 270 per cent.

Unmet demand from the private placement could spill over into the public offer, which has already generated significant investor interest in Nigeria.

In June, the SEC halted marketing activities related to the share sale after reports that some retail investors, including those with little or no knowledge of equity investment, were opening trading accounts in anticipation of the IPO.

Investor interest is also growing among major international players. Bloomberg reported on Monday that Abu Dhabi National Oil Company, ADNOC, had opened discussions with Dangote Refinery about acquiring a stake in the company.

The report added that the refinery had also received approaches from other major investors.

The IPO, scheduled to launch on September 14, is expected to benefit from improved liquidity and renewed foreign investor interest following Nigeria’s restoration to frontier market status by FTSE Russell.

The offering could also provide a model for other major Nigerian companies seeking to become publicly quoted firms and raise capital through the stock market.

State-owned NNPC Limited has considered an IPO since 2021, following its transition to a limited liability company.

Dangote Refinery, which commenced production in January 2024, has also emerged as a major supplier of refined petroleum products, including jet fuel, to international markets.