• Offer attracted 3.7 times subscription compared to initial size
•International, African investors back refinery’s expansion
•Proceeds to strengthen capital structure, fund growth, says company
Emmanuel Addeh in Abuja and Peter Uzoho in Lagos
Dangote Petroleum Refinery and Petrochemicals has successfully completed a landmark $2.5 billion private equity placement, with the offer attracting subscriptions 3.7 times above its initial size in what the company described as Africa’s largest publicly disclosed primary equity private placement by value.
The company, in a statement yesterday, said the transaction resulted in the issuance and allotment of approximately $2.5 billion in new equity and marked the refinery’s first equity capital raise involving external investors beyond its legacy shareholder base.
According to the statement, the capital raise represented a significant milestone in the company’s long-term funding strategy and is expected to support the continued expansion of its refining and petrochemical operations while contributing to the development of African capital markets.
It explained that proceeds from the private placement would be deployed to support the ongoing expansion of the refinery and petrochemical complex, strengthen the company’s capital structure and provide additional financial flexibility for future growth initiatives.
The company disclosed that the offering attracted strong participation from a broad range of international and African institutional investors, sovereign-related investment vehicles, development finance institutions and long-standing strategic partners.
Among the key investors were Africa Finance Corporation (AFC) and India Infra Buildco, an investment vehicle facilitated by the African Export-Import Bank (Afreximbank), alongside a mix of institutional and individual investors, reflecting what it described as strong market confidence in the refinery’s long-term strategy.
President and Chief Executive of Dangote Industries Limited and Chairman of Dangote Petroleum Refinery and Petrochemicals, Aliko Dangote, described the transaction as a major step in broadening the company’s ownership structure while supporting its expansion plans.
He said: “This is a strategic step to deepen and further institutionalise the Enterprise’s shareholder base, while raising capital to complement our internal cash flows and external funding, as DPRP advances its expansion agenda.
“This further demonstrates our profound commitment to developing domestic refining and petrochemical capacity, reducing Africa’s reliance on imported refined products and strengthening the continent’s energy security.”
Also commenting, Managing Director and Chief Executive Officer of Dangote Petroleum Refinery and Petrochemicals, David Bird, said the level of investor interest reflected confidence in the company’s operations and leadership.
“The exceptional demand we saw is a testament to our operational excellence, execution capacity, and investor confidence in DPRP’s leadership,” Bird stated.
The company noted that with the successful completion of the transaction, it is well positioned to continue executing its long-term growth strategy while expanding Africa’s refining and petrochemical capacity.
It added that the strong investor response reinforces confidence in its strategic direction and strengthens its platform for sustainable long-term value creation.
Besides the private placement, the Dangote Petroleum Refinery is preparing for what is expected to be one of Africa’s biggest Initial Public Offerings (IPO), with plans to offer a minority stake to public investors later this year.
The proposed listing is aimed at broadening the refinery’s ownership base, deepening Nigeria’s capital market and raising fresh capital to support expansion, while giving institutional and retail investors an opportunity to participate in the country’s largest private industrial project.
Reports indicate the offer could value the refinery at about $40 billion, although the final valuation and offer size will be subject to regulatory approvals and market conditions.
Beyond providing access to capital, the IPO is also expected to strengthen the company’s corporate governance through enhanced disclosure and reporting requirements associated with a public listing.