Dangote Refinery raises $600m, secures further $400m IPO commitment

The Dangote Petroleum Refinery has completed a $1 billion underwriting programme ahead of its planned initial public offering, IPO, strengthening its preparations for a potential listing on the capital market.

The programme comprises a completed and funded $600 million private placement and a further $400 million underwriting commitment in support of the planned IPO.

According to a statement issued on Tuesday, the programme was structured by Marob Strategies and Consulting DIFC Ltd and Lilium Capital Group.

The refinery said the $600 million private placement had been underwritten and funded by Pan-African Refinery Investment SPV, a subsidiary of Lilium Capital Group.

“The planned Initial Public Offering of the Dangote Petroleum Refinery & Petrochemicals has taken a significant step forward with the successful completion of a US$1 billion underwriting programme, strengthening the capital markets foundation for what could become Africa’s most consequential industrial listing,” the statement said.

The refinery said Marob Strategies and Lilium Capital were now coordinating the distribution of the underwriting participation across Global Africa, targeting sovereign wealth funds, governments, institutional investors and other eligible investors.

It said the response had been strong, according to the advisers, reflecting growing institutional interest in large-scale African assets with the potential to generate long-term economic value.

The refinery added that the programme was expected to facilitate intra-African capital flows and contribute to the development of a more integrated African capital market under the African Continental Free Trade Area, AfCFTA,.

According to the statement, the $1 billion underwriting programme goes beyond a conventional capital-raising exercise, as it is expected to deepen African capital markets, broaden ownership of a strategic African enterprise and demonstrate the ability of African institutions to mobilise long-term capital for industrialisation, energy security, import substitution and trade integration.

‘Important milestone for African capital markets’

Commenting on the development, Aliko Dangote, President and Chief Executive Officer of Dangote Industries Limited, described the transaction as an important milestone for the refinery and African capital markets.

“This is an important milestone for DPRP and for African capital markets,” Dangote said.

He said the transaction reflected confidence in the refinery’s strategic role while creating 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,” he said.

Dangote added that the work undertaken by Marob Strategies and Lilium Capital had created an opportunity for broader participation by institutional investors across Global Africa.

Benedict Oramah, Chairman of Marob Strategies, said the transaction demonstrated investor appetite for African-led capital market transactions that provide access to transformative assets on the continent.

“Marob Strategies is now focused on disciplined distribution across Global Africa and is engaging sovereign wealth funds, governments, institutional investors and other eligible investors,” he said.

He said the level of interest confirmed growing appetite for African-led capital market transactions, adding that the development could pave the way for similar transactions in the future.

Simon Tiemtoré, Chairman of Lilium Capital Group, described the mandate as part of the firm’s efforts to connect major African investment opportunities with institutional investors across Global Africa and international markets.