Dangote Petroleum Refinery is seeking to raise nearly $1 billion through a private placement, valuing the company at approximately $39.1 billion, according to sources familiar with the matter and a placement document reviewed.
The offering consists of 3 billion common shares, priced at $0.35 per share. Investor demand already exceeds $2 billion, indicating strong interest in the offering. Subscribers will be required to purchase a minimum of one million shares, or $350,000, with additional purchases in tranches of 500,000 shares. The shares will be subject to a one-year lock-up period.
The funds raised will be allocated to the company's expansion and general operational needs as the refinery ramps up production and consolidates its market position. With a capacity of 650,000 barrels per day and scheduled to begin production in 2024, it has significantly increased Nigeria's production of diesel, aviation fuel, naphtha, and gasoline, particularly in reducing its reliance on imported refined products.
Beyond this fundraising, market players anticipate new investments in logistics infrastructure, storage and distribution, as well as a possible diversification into petrochemicals.
This transaction could also pave the way for an initial public offering (IPO), which Aliko Dangote, the billionaire owner of the group, has already mentioned for later this year. Refinery officials declined to comment on the transaction.
