Dangote Refinery Seeks New York Listing After 2029 Expansion

Africa's richest man, Aliko Dangote, is considering listing shares of his Nigerian refinery business on a US stock exchange within the next three to four years, following the launch of its initial public offering (IPO) in Lagos. The current share sale aims to raise $1.6 billion, with the potential to increase by 30% if oversubscribed. The refinery is currently valued at approximately $50 billion, more than double its construction cost.

The timeline for the potential US listing aligns with the company's plans to double the refinery's output to 1.4 million barrels per day by early 2029. This expansion would make it the largest refinery globally, surpassing India's Jamnagar refinery. The refinery's Chief Financial Officer, Bruce Tanner, indicated that international secondary listings would be pursued after the production ramp-up, with the US being the most likely target.

Proceeds from the ongoing IPO will be directed towards the Nigerian expansion. Further fundraising is anticipated in the future. The refinery reported $13.9 billion in half-year revenue this year and forecasts annual increases up to 2030, driven by increased refining capacity. The expansion is expected to cost approximately $14 billion and will also broaden the refinery's petrochemical production, including linear alkyl benzene, base oil, and polypropylene. The IPO is offering 4.1 billion ordinary shares at N525 each, targeting about N2.15 trillion.

Dangote's wealth could increase by over 60% to $58 billion due to the Nigerian refinery's IPO. A US listing is seen as a way to secure dollar liquidity, index inclusion, and institutional capital that the Nigerian Exchange cannot offer. However, the track record of African businesses on US exchanges has been mixed, as exemplified by Jumia's fluctuating stock performance after its 2019 New York Stock Exchange debut, which saw its stock trade roughly 75% below its IPO price today. Other African commodity players like Sasol and AngloGold Ashanti trade as American Depositary Receipts (ADRs) rather than direct listings.