Aliko Dangote has pushed the close of his refinery IPO back by two weeks. The offer was set to shut on Tuesday and will now run to October 27, with Nigeria’s SEC signing off.
The stated reason is reach. The company wants investors in more countries to get a seat in the continent’s biggest listing to date. It is also a quiet signal that the order book has not yet delivered the knockout headline the Dangote camp wants.
The numbers are simple. The refinery is selling 4.1 billion new shares at N525 each, targeting N2.15 trillion, about $1.6 billion, with up to $2.1 billion possible. Because it is a primary issue, the cash goes to the plant, not to existing shareholders. The minimum buy is 10 shares, roughly $4, through digital investment platforms.
That small ticket was the point. Dangote pitched it as a “people’s IPO,” and Nigerians showed up. Bamboo, the investment app, said the surge in traffic locked some users out.
Two weeks ago in Nairobi, Dangote claimed the demand was “enormous” and gave no figures. No subscription numbers have been published since.
So what is the money for? Capacity. The IPO is meant to fund a doubling of the refinery to 1.4 million barrels a day, and Dangote wants the world’s largest single-train refinery by 2028. The plant reached its full 650,000 barrels a day earlier this year. Even a fully upsized raise covers only a slice of that bill. Bonds, private placements and internal cash are all on the table for the rest.
Then there is the price tag, and the argument around it.
At N525 a share, the refinery is valued at about $47bn. The $2.5bn private placement in July put it near $40bn. AP puts the figure at $49bn, more than twice what the plant cost to build, and says refinery officials deny the valuation is inflated. One Lagos analyst quoted by AP said that a number this high leaves the plant with little room to disappoint on profit and cash flow.
Margins are the soft spot. Analysts warn that persistently high feedstock costs could squeeze earnings and cap what investors will pay. The war involving Iran has lifted the refinery’s earnings, and Dangote insists the long-term case does not depend on those windfalls. Investors are being asked to take that on trust.
Control is not changing. Dangote keeps 87 percent of the refinery after the offer. Ordinary buyers are getting a seat in the stands, not on the board.
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The shares are not tradable yet. The stock will not list in Nigeria until November. Dangote has floated a secondary US listing in three to four years.
The books close October 27. After that, the market decides what Dangote’s refinery is really worth.
