The Securities and Exchange Commission has approved the commencement of the Initial Public Offering of Dangote Petroleum Refinery and Petrochemicals FZE, clearing the way for the company to offer 4.1 billion ordinary shares to investors.
The approval could pave the way for one of Nigeria’s biggest capital market transactions, with the shares priced at N525 each, potentially generating about N2.15tn if fully subscribed.
The approval was conveyed in a letter to the Lead Issuing House, Vetiva Advisory Services Limited, and signed by Abdulkadir Abbas, Director of the SEC’s Securities and Investment Services Department.
The Commission also approved the registration of the company’s existing 120.13 billion ordinary shares as part of the process.
With the draft offer documents cleared, the refinery can proceed to the Completion Board Meeting and Signing Ceremony, ahead of the commencement of the public offer.
The development comes as the planned listing continues to attract significant attention from investors, with the offering expected to rank among the largest equity transactions in Nigeria.
IPO TO OPEN SEPTEMBER 14 — REPORT
A report by Reuters on Friday said the Dangote Refinery IPO is scheduled to open its order book on September 14, with the company expected to offer the 4.1 billion shares at N525 each.
Reuters reported that the offering could raise approximately $1.5bn, while a 15 per cent greenshoe option could allow the company to raise additional funds if the offer is oversubscribed.
The latest development followed comments by Dangote Group President, Aliko Dangote, who said the IPO would open within the next 10 to 12 days.
“So our dream is that we want to make sure we double the capacity of the refinery… which will take us to 1.4 million barrels per day. The IPO will open in the next 10 to 12 days,” Dangote said while speaking to investors and analysts in Botswana.
The funds are expected to support plans to expand the refinery’s capacity from its current 650,000 barrels per day to 1.4 million barrels per day. The refinery has also tested output of up to 700,000 barrels per day.
Another report published Friday said the proposed IPO price could range between N500 and N595 per share, although N525 was identified as the price being considered. At that range, the 4.1 billion-share offer could raise between $1.55bn and $1.8bn.
REFINERY EXPANSION
Located in the Lekki Free Zone, Lagos, the Dangote Refinery is Africa’s largest oil refinery and has a nameplate capacity of 650,000 barrels per day.
The company plans to double its capacity to 1.4 million barrels per day, with the IPO proceeds expected to contribute to funding the expansion.
The refinery has previously raised funds through a private placement and a $750m Eurobond, as it continues to strengthen its balance sheet and finance its expansion plans.
The planned IPO is expected to provide investors with direct exposure to one of Africa’s largest industrial and energy assets while deepening activity in Nigeria’s capital market.
