The Businessinsider is preparing for an initial public offering (IPO) that could become the largest stock market listing in Africa’s history. The company is seeking to raise approximately $5 billion, with the offering expected to conclude in October, according to sources cited by Reuters.
The refinery, built by Aliko Dangote at an estimated cost of $20 billion, has already submitted its IPO application to Nigeria’s Securities and Exchange Commission (SEC). The company is expected to receive approval in the coming weeks, which would allow for the publication of a prospectus in September. While the $5 billion target is the current goal, sources noted that the final amount will depend on the approval of the Nigerian regulator.
Valuation and Market Impact
A recent private placement in which investors acquired a 6% stake for $2.5 billion valued the refinery at approximately $40 billion. This valuation positions the facility as one of the most valuable privately owned industrial assets on the continent. If the $5 billion fundraising target is met, it would represent more than 4% of the Nigerian Exchange’s current market capitalization, which stood at $116 billion as of Tuesday.
The 650,000-barrel-per-day refinery began producing fuel in 2024 and reached full operating capacity earlier this year. The Nigerian National Petroleum Company (NNPC) currently holds a stake of just over 7% in the facility.
Pan-African Investment Strategy
Aliko Dangote has expressed a desire for the IPO to be a pan-African venture, aiming to allow capital markets across the continent to participate in what sources described as an African champion.
This strategy aligns with a broader vision to reduce Africa’s reliance on imported refined petroleum products and establish the continent as a net exporter of fuel.
Significant interest has emerged from several regional markets:
- Kenya: Institutional investors, including pension funds, could potentially contribute as much as $500 million, accounting for roughly 10% of the total fundraising target.
- South Africa: The Johannesburg Stock Exchange (JSE) has engaged with the Dangote Group. A JSE spokesperson confirmed the company intends to list in Nigeria first but has “strong intent to hopefully bring the listing to South Africa” as a secondary listing.
- Other Markets: Discussions have taken place with regulators and market participants in Rwanda, Ghana, and Egypt to explore how their investors can participate.
Because a cross-listing or dual listing is not planned at this stage, other continental markets may need to develop structured solutions
for their investors, such as exchange-traded instruments or global depositary receipts that mirror the shares listed on the Nigerian exchange.
Future Expansion and Objectives
The capital raised through the IPO is intended to support the expansion of the Lagos-based refinery. Aliko Dangote stated in April that the refinery is aiming to increase its output to 1.4 million barrels per day. Additionally, the funds may help finance plans to replicate the refinery project in other locations on the continent, with Kenya identified as a potential site for a similar facility.
Industry analysts suggest the move is a significant indicator of industrialization. Craig Morkel, chair of the South African Oil and Gas Alliance’s Gas Economy Leadership Group, stated that a successful IPO would be a potential vote of confidence in Africa and its industrialisation through energy infrastructure.
Morkel noted that such an investment could help the continent better manage supply-chain disruptions caused by regional conflicts or global pandemics.
