Dangote targets 10m shareholders with refinery IPO

By Abubakar Yunusa

President of Dangote Industries Limited, Aliko Dangote, has set a target of attracting 10 million shareholders across Africa through the Initial Public Offering of Dangote Petroleum Refinery and Petrochemicals.

Dangote said the IPO was designed to broaden ownership of the multibillion-naira refinery and give ordinary Africans an opportunity to become shareholders.

The refinery’s public offer, valued at about N2.15tn, comprises 4.1 billion ordinary shares priced at N525 each.

The minimum subscription is 10 shares, meaning investors can participate with N5,250. The offer opened on September 14 and is scheduled to close on October 14, ahead of a planned November listing on the Nigerian Exchange.

Speaking on the offering, Dangote said raising funds was not the primary reason for taking the refinery to the public market.

He said the company already had strong cash flow and had previously raised funds through bonds and private placements.

“So it’s not really about raising money. If we want to raise money, we know how to raise,” Dangote said.

“We are targeting 10 million shareholders from all over Africa and maybe other parts of the world,” he added.

Dangote said the offer was intended to accommodate ordinary Nigerians, workers, small business owners and other retail investors.

“We want to democratise the capital market,” he said in an interview with Arise TV.

The businessman said the wider ownership structure would allow more Africans to participate in the growth of large businesses.

“We are creating big corporations where we don’t want to be the only people enjoying. We want to spread this enjoyment to the rest of Africa,” he said.

The refinery, located near Lagos, currently has a stated refining capacity of 700,000 barrels per day.

Under its expansion plans, the facility is expected to increase its capacity to 1.4 million barrels per day by 2028.

The IPO is expected to raise about $1.6bn, with part of the proceeds earmarked for the refinery’s expansion programme.

The public offer is being distributed electronically through banks, fintech platforms, stockbrokers and other financial intermediaries to facilitate participation by retail investors.

If the 10-million-shareholder target is achieved, the offer would significantly expand retail participation in Nigeria’s capital market, with the transaction advisers describing the target as about 20 times the country’s existing retail participation record.