Dangote refinery completes $2.5bn equity placement

Dangote Petroleum Refinery and Petrochemicals has completed a landmark $2.5bn private equity placement after the offer attracted demand more than three times the initial size.

The company said the transaction, which achieved a 3.7 times subscription rate, resulted in the issuance and allotment of approximately $2.5bn in new equity.

In a statement issued on Thursday, the company said, “Dangote Petroleum Refinery and Petrochemicals FZE (“DPRP” or the “Enterprise”) today announces the successful completion of its landmark Private Placement, which achieved 3.7 times subscription relative to the initial offer size and resulted in the issuance and allotment of approximately US$2.5 billion in new equity.

“This transaction is believed to be Africa’s largest publicly disclosed primary equity private placement by value.”

The company described the equity raise as a major milestone in its long-term funding strategy, noting that it was its first equity capital raise involving external investors beyond its legacy shareholder base.

“The offering marks a significant milestone in advancing its long-term funding strategy and the continued development of African capital markets,” the statement added.

Dangote Petroleum Refinery and Petrochemicals said proceeds from the placement would support the expansion of its refinery and petrochemical complex, strengthen its capital structure and provide additional financial flexibility for future growth initiatives.

The company said the investment attracted strong participation from a diverse group of international and African institutional investors, sovereign-related investment vehicles, development finance institutions and strategic partners.

It listed the Africa Finance Corporation and India Infra Buildco, an investment vehicle facilitated by the African Export-Import Bank, among investors that participated in the transaction, alongside other institutional and individual investors.

According to the statement, the participation of the investors “underscores deep and diversified market confidence in DPRP’s long-term strategy.”

The President and Chief Executive Officer of Dangote Industries Limited and Chairman of Dangote Petroleum Refinery and Petrochemicals, Aliko Dangote, said the transaction would help strengthen the company’s ownership structure while providing additional funding for expansion.

He said the private placement was “a strategic step to deepen and further institutionalise the Enterprise’s shareholder base, while raising capital to complement our internal cash flows and external funding, as DPRP advances its expansion agenda.”

Dangote added that the move reflected the company’s commitment to increasing refining capacity on the continent.

“This further demonstrates our profound commitment to developing domestic refining and petrochemical capacity – reducing Africa’s reliance on imported refined products and strengthening the continent’s energy security,” he said.

The Managing Director and Chief Executive Officer of Dangote Petroleum Refinery and Petrochemicals, David Bird, said the level of investor interest demonstrated confidence in the company’s operations and leadership.

“The exceptional demand we saw is a testament to our operational excellence, execution capacity, and investor confidence in DPRP’s leadership,” Bird said.

The company said the successful completion of the equity placement would enable it to continue executing its long-term growth strategy while strengthening Africa’s energy security through large-scale refining and petrochemical capacity.

The Dangote refinery, located in Lagos, has a production capacity of 650,000 barrels per day and is one of the largest single-train refineries in the world.