By Chibuzor Alli
Investors have submitted share applications worth approximately N5.85 trillion ($4.1bn) for Dangote Petroleum Refinery’s initial public offering (IPO), nearly three times its original fundraising target, in a major show of confidence in Africa’s largest oil refinery.
The overwhelming demand, which has attracted investors from all 54 African countries, has reportedly exceeded the number of shares available, raising the possibility of an expanded offering to accommodate more prospective shareholders.
According to a Bloomberg report, the refinery initially sought to raise at least $1.6bn but received investment interest of approximately $1.9bn from Nigerian investors and another $2.1bn from prospective international buyers.
The scale of participation has been particularly striking among retail investors, with people familiar with the transaction telling Bloomberg that the offering has attracted nearly four million unique subscription applications.
“There are close to four million unique subscription applications,” the people familiar with the transaction said, according to Bloomberg.
The strong response comes as the refinery seeks to widen its ownership base beyond wealthy individuals and institutional investors, having previously set a target of attracting 10 million retail shareholders.
Pension funds join scramble for refinery shares
Beyond individual investors, major institutional investors are also seeking significant stakes in the $20bn refinery, with pension fund managers in Nigeria and South Africa reportedly among those interested in the offering.
South Africa’s Public Investment Corporation (PIC), which manages approximately $220bn in pension assets belonging to state workers, has reportedly requested a substantial allocation, although the size of its request was not disclosed.
Nigerian pension fund managers, whose investments cover approximately 11 million retirement savings contributors, have also sought allocations, Bloomberg reported.
The involvement of major pension funds highlights the growing institutional appetite for the refinery’s shares and the potential significance of the IPO for African capital markets.
According to the report, the South African fund’s request could be accommodated through a secondary share sale, potentially creating additional opportunities for investors who could not secure shares through the initial allocation.
Foreign demand exceeds available shares
International interest has been particularly strong, prompting considerations for an expanded share allocation.
Bloomberg had reported last month that the refinery was expected to exercise an additional 30 per cent over-allotment option, largely to create room for overseas investors.
However, the proposed expansion may still fall short of satisfying foreign demand.
“Even with the expanded allocation that would take the fundraising to about $2.1bn, demand from foreign investors has exceeded available stock,” the report said.
The additional allocation could increase the IPO proceeds to approximately $2.1bn, above the initial fundraising target of at least $1.6bn.
The transaction is being described as Africa’s largest public share sale to date, with its cross-border participation drawing attention to the continent’s capacity to mobilise domestic and regional capital for major industrial investments.
SEC approval and December trading timeline
Attention is now shifting to the regulatory process and the eventual commencement of trading in the refinery’s shares.
People familiar with the transaction told Bloomberg that the refinery is expected to submit a draft share allotment announcement to the Securities and Exchange Commission (SEC) this week.
The regulator is expected to approve the distribution of shares on November 17, with trading scheduled to commence 15 business days after the allotment date.
Under that timeline, trading could begin around December 8, although the company is reportedly targeting a commencement date before the end of November, subject to regulatory approvals.
The IPO has also attracted attention from stock exchanges across Africa, which are providing structures to enable investors in different countries to participate in the offering.
Dangote refinery IPO tests Africa’s investment capacity
Owned by Africa’s richest man, Aliko Dangote, the 700,000-barrel-per-day refinery is located in the Lekki area of Lagos State and represents one of the continent’s biggest industrial investments.
The facility is central to Nigeria’s ambition to reduce dependence on imported petroleum products while strengthening domestic refining capacity.
Beyond raising capital, the IPO is expected to broaden the refinery’s ownership structure, attract long-term institutional investment and deepen participation in African capital markets.
The scale of subscriptions also highlights the potential of African investors to finance major infrastructure and industrial projects on the continent, reducing the traditional reliance on international financial centres such as London and Wall Street.
With applications reportedly reaching N5.85tn, the Dangote Refinery share sale is emerging as a major test of investor appetite for large-scale African industrial assets.
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