How Nigerian investors should prepare before subscribing
After more than two years of delays and speculation, the Dangote Refinery IPO has entered its final regulatory phase. Dangote Petroleum Refinery has submitted its application to the Securities and Exchange Commission for what could become the largest initial public offering in African capital markets.
Subject to regulatory approval, the prospectus is expected in September, with the public offer targeted for October. The transaction is expected to raise about $5 billion, valuing the refinery at between $40 billion and $50 billion.
For investors, the question is no longer whether the IPO will happen. It is whether they will be ready when subscriptions open. The listing is significant not only because of its size but also because it gives investors access to one of Africa’s largest industrial assets. Built at an estimated cost of $20 billion, the refinery has reached its nameplate capacity of 650,000 barrels per day, supplying most of Nigeria’s petrol demand while exporting refined products to regional and international markets.
One feature could make the offer particularly attractive. Dangote has indicated that investors will subscribe in naira while having the option of receiving dividends in US dollars, subject to regulatory approval. If implemented, it would create a rare opportunity for Nigerian investors to earn foreign-currency income from a domestic listed company.
