• Deal comprises completed, funded $600m private placement, $400m underwriting commitment
•Transaction reflects confidence in refinery’s strategic role, says Africa’s richest man
•Oramah: Transaction demonstrated the appetite for African-led capital markets
Emmanuel Addeh in Abuja and Peter Uzoho in Lagos
The planned Initial Public Offering (IPO) of the Dangote Petroleum Refinery & Petrochemicals has taken a significant step forward with the successful completion of a $1 billion underwriting programme, strengthening the capital markets foundation for what could become Africa’s most consequential industrial listing.
The programme, structured by Marob Strategies and Consulting DIFC Ltd and Lilium Capital Group, comprises completed and funded $600 million private placement and a further $400 million underwriting commitment in support of the refinery’s planned IPO.
Dangote Group disclosed this in a statement issued yesterday, saying the $600 million private placement was underwritten and funded by Pan-African Refinery Investment SPV, a subsidiary of Lilium Capital Group.
The group added that Marob Strategies and Lilium Capital are now coordinating the distribution of the underwriting participation across Global Africa, engaging sovereign wealth funds, governments, institutional investors and other eligible investors.
The response, according to the advisers, has been strong, reflecting growing institutional appetite for large-scale African assets capable of generating long-term economic value.
The programme is also expected to catalyse significant intra-African capital flows and help pave the way towards a more integrated African capital market under the auspices of the African Continental Free Trade Area (“AfCFTA”).
According to the statement, the $1 billion underwriting programme was designed to be more than a capital-raising exercise.
It added that the transaction is expected to help deepen African capital markets, broaden ownership of a strategic African enterprise and demonstrate how African institutions can mobilise long-term capital for industrialisation, energy security, import substitution and trade integration.
President and Chief Executive of Dangote Industries Limited, Aliko Dangote, described the transaction as an important milestone for both the refinery and African capital markets.
“This is an important milestone for DPRP and for African capital markets,” Dangote said, adding that the transaction reflects confidence in the refinery’s strategic role and creates a platform for broader participation by African and Caribbean sovereign wealth funds, governments and institutional investors across Global Africa.
“The successful completion of the private placement, together with the US$400 million underwriting commitment provided by Pan-African Refinery Investment SPV in support of the planned IPO, reflects confidence in the refinery’s strategic role.
“The work undertaken by Marob Strategies and Lilium Capital has also created a platform for broader participation by African and Caribbean sovereign wealth funds, governments and institutional investors across Global Africa,” he said.
Chairman of Marob Strategies, Prof. Benedict Oramah, said the transaction demonstrated the appetite for African-led capital markets transactions providing access to transformative assets on the continent.
“As Chairman, I am very proud of the work undertaken by the management team at Marob Strategies to bring this transaction to fruition. Marob Strategies is now focused on disciplined distribution across Global Africa and is engaging sovereign wealth funds, governments, institutional investors and other eligible investors.
“The level of interest confirms the appetite for African-led capital markets transactions that provide investors with access to transformative assets on the continent. The success of this transaction paves the way for many more such transactions in the future,” he added.
Chairman of Lilium Capital Group, Simon Tiemtoré, similarly described the mandate as part of the firm’s effort to connect major African opportunities with institutional investors across Global Africa and international markets.
“This mandate reflects Lilium Capital’s commitment to connecting world-class African opportunities with institutional investors across Global Africa and international markets. By mobilising long-term capital for strategic assets such as the Dangote Petroleum Refinery, we are supporting industrialisation, strengthening capital markets and contributing to sustainable economic growth across the continent.
“We are proud to support DPRP on this landmark transaction and look forward to mobilising capital for more transformative projects that create lasting value for Africa,” Tiemtoré said.