Nigeria’s Securities and Exchange Commission has approved Dangote Refinery’s planned initial public offering, paving the way for what could become Africa’s largest-ever share sale.
Dangote Group announced on Friday that the regulator had cleared the offer, which could raise approximately N2.15tn if fully subscribed, according to Reuters.
The refinery plans to offer 4.1 billion ordinary shares at N525 each, giving investors an opportunity to participate in one of Africa’s largest industrial projects.
The SEC has also registered 120.13 billion existing ordinary shares in the refinery, implying a valuation of approximately $47bn, according to Reuters’ calculations.
The 650,000-barrel-per-day refinery, located on the outskirts of Lagos, was constructed at an estimated cost of $20bn. Since beginning operations, the facility has emerged as a major player in Nigeria’s fuel market while expanding exports of refined petroleum products to markets across Africa and Europe.
“With SEC approval now secured, the refinery is poised to embark on a historic public offering that could significantly broaden investor participation in one of Nigeria’s most transformative industrial ventures,” Reuters quoted the company as saying.
The offer is expected to open for subscription on September 14, according to a source familiar with the transaction, in line with comments made by the group’s majority shareholder, Aliko Dangote, on Thursday.
Proceeds from the share sale will help fund Dangote Refinery’s expansion plans, which aim to more than double its current capacity to 1.4 million barrels per day.
Ahead of the IPO, the company has taken steps to strengthen its financial position, including raising $2.5bn through a private placement and securing underwriting commitments from investors.
A formal signing ceremony with the Nigerian Exchange is expected to be held next week, according to two company sources cited by Reuters.
On Thursday, Aliko Dangote said he wants the refinery to rank among Africa’s largest companies, with a target of generating more than $12bn in earnings before interest, tax, depreciation and amortisation.
He added that the share offer would be open to investors across Africa, including retail investors in Nigeria.
