Dangote Refinery is set to open its landmark initial public offering (IPO) to investors next week, with the company fixing N5,250 as the minimum entry point for retail subscribers.
The $1.6 billion offer, equivalent to about N2.2 trillion, is expected to become Africa's largest public equity offering and will give millions of investors an opportunity to acquire stakes in the 700,000 barrels-per-day refinery.
The refinery's owner, Aliko Dangote, announced the minimum subscription requirement on Monday during the formal signing and endorsement of the IPO documents in Lagos.
Under the terms of the offer, investors can subscribe for as few as 10 ordinary shares at N525 per share.
Dangote said the company was deliberately making the offer accessible to Nigerians across different income and occupational groups, including traders, drivers, cooks, managers and other ordinary members of the public.
“There is no segregation on who can own these shares. We want every human being living on the continent to be part of this action,” he said.
The Chief Executive Officer of FirstCap, Ukandu Ume Ukandu, disclosed that the offer is targeting approximately 10 million retail investors.
The offer, coordinated by Vetiva Advisory Services Limited, will open on September 14 and close on October 13.
The Securities and Exchange Commission (SEC) gave regulatory approval for the transaction last week, clearing the way for the subscription of 4.1 billion shares at N525 each.
Refinery valued at nearly $50bn
The offer puts the valuation of the Dangote Refinery at close to $50 billion, underscoring the scale of the project and its growing importance to Nigeria's energy sector.
The company intends to use the proceeds to finance an expansion that will double the refinery's capacity from its current 700,000 barrels per day to 1.4 million barrels per day.
Located on a 6,180-acre site on the outskirts of Lagos, the refinery commenced production in January 2024.
If successfully listed on the Nigerian Exchange, the refinery could increase the market capitalisation of the domestic equities market by more than one-third.
The company is also pursuing a broader African capital-market presence. Plans are underway for a possible cross-border listing on the Johannesburg Stock Exchange, while listings in Egypt, Kenya, Ghana and Rwanda are also being considered.
Strong investor appetite
Investor interest in the company has been building steadily, with the refinery raising $2.5 billion through a private placement in July.
The transaction, which was targeted at institutional investors and high-net-worth individuals, was reportedly oversubscribed by 270 per cent.
Demand that could not be accommodated during the private placement may spill into the public offering, potentially putting further pressure on the available shares.
The IPO has also attracted significant attention among retail investors.
In June, the SEC moved to stop promotional and marketing activities linked to the proposed share sale after reports that some prospective investors had begun opening trading accounts specifically to participate in the offer.
The development highlighted the unusually high level of public interest in the refinery, including among people with little previous experience in equity investment.
ADNOC, others eye stake
The refinery's growing appeal is not limited to Nigerian retail investors.
Abu Dhabi National Oil Company (ADNOC) is reportedly in discussions with Dangote Refinery over a possible investment in the company, while other major international investors are also said to have expressed interest.
The planned listing comes against the backdrop of renewed expectations of increased foreign investment in Nigeria following FTSE Russell's return of the country to frontier market status.
Nigeria had spent almost three years under an unclassified market status, a situation that discouraged some international investors and restricted the country's access to global portfolio flows.
The Dangote IPO could therefore serve as a major test of the depth and capacity of Nigeria's capital market.
Could set precedent for NNPC
Beyond raising funds for Dangote Refinery, the transaction could provide a template for other major Nigerian companies seeking to tap the equities market.
NNPC Limited, the country's state-owned energy company, has considered an IPO since its conversion into a limited liability company in 2021.
The company renewed discussions about a possible listing last year, although concerns over transparency, financial reporting and its longstanding operational challenges remain significant issues for potential investors.
A successful Dangote Refinery flotation could demonstrate the potential of large Nigerian businesses to mobilise substantial long-term capital through public ownership.
Meanwhile, the refinery's position in the international petroleum market continues to strengthen.
In June, it reportedly displaced the United States as Europe's largest external supplier of jet fuel and retained that position in July.
The planned expansion to 1.4 million barrels per day could further increase the refinery's export capacity and strengthen Nigeria's position as a major supplier of refined petroleum products to international markets.
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