The initial public offering of Dangote Petroleum Refinery and Petrochemicals, the largest share offer in Africa, has closed with investor applications spanning 120 countries, the company said in a statement late on Tuesday. The offer was initially due to close on October 13 and was extended by two weeks, to October 27, to allow more African investors to participate.
The company did not disclose how much the offering raised against its $1.6 billion target. Aliko Dangote said earlier this month that demand had exceeded the goal by more than three to four times, and Bloomberg reported, citing people familiar with the matter, that the offer had attracted about $1.5 billion to $1.6 billion of fully funded commitments from domestic and retail investors alone, effectively meeting the target before international demand was accommodated. Bloomberg’s sources counted applications from 119 nations, one fewer than the company’s 120 country figure, and said investors from all 54 African countries applied for the first time.
The company is expected to use a 30 percent over-allotment option, largely to create room for overseas investors, which would take the fundraising to about $2.1 billion, Bloomberg reported. The offer used nominee structures with Standard Bank Group for investors in Egypt and Ethiopia and global depository receipts sold through the stock exchanges in Kenya and Botswana. If demand significantly outstrips supply, Dangote could sell part of his own stake to investors who miss out in the offer, although no decision on a secondary sale has been made, the people said.
“This is a historic achievement for Africa,” Dangote said in the statement. The Lagos refinery has capacity of 700,000 barrels per day and aims to double output to 1.4 million barrels per day, which would make it the largest refinery in the world. Final allocations and the amount raised have not yet been published.