Nigeria's Dangote Refinery plans to raise approximately $1.5 billion through an initial public offering, according to three sources familiar with the matter. The offering would value the complex at around $15 billion.
The capital injection would ease pressure on Nigeria's foreign exchange reserves and improve its current account balance. A successful IPO could attract significant foreign portfolio investment, potentially strengthening the Nigerian Naira against the U.S. dollar.
Analysts at Standard Chartered said a large capital inflow could compress Nigeria's sovereign bond spreads, particularly for its U.S. dollar-denominated debt. The country's 2032 Eurobond currently yields 9.5 percent, reflecting persistent fiscal and currency risks.
The refinery, with a capacity of 650,000 barrels per day, began production earlier this year. Full operation is expected to reduce Nigeria's reliance on imported refined petroleum products by 90 percent, potentially saving the nation billions in foreign exchange annually. This shift directly impacts the supply-demand dynamics for the Naira, offering a structural tailwind for currency stability as the central bank battles inflation and depreciation.
The IPO is expected to launch in Lagos later this year, with a potential dual listing in London to tap a broader institutional investor base. Advisers are assessing investor appetite, focusing on institutional funds with emerging market mandates and those seeking exposure to African energy infrastructure.
Formal regulatory filings are anticipated by the end of the third quarter, setting the stage for a potential listing before year-end.
