Dangote Refinery’s overlooked advantage could be its working-capital model

FCMB Group is actively involved in the initial public offering (IPO) of Dangote Petroleum Refinery and Petrochemicals FZE. The company is offering 4.1 billion ordinary shares at N525 apiece, with a total value of approximately N2.15tn if fully subscribed. The IPO commenced on September 14 and is set to conclude on October 13. FCMB Group is participating through three entities - FCMB Capital Markets, a joint issuing house; CSL Stockbrokers, a stockbroker; and FCMB itself, serving as the receiving bank and distribution agent.

FCMB Group's Chief Executive, Ladi Balogun, emphasized that the offer provides Nigerians access to a world-class business and showcases the expanding reach of the nation's capital market. He noted that the minimum subscription permits individual investors to purchase 10 shares for a fee of N5,250. Balogun highlighted the increasing participation from various investor categories, including retail, high-net-worth, institutional, and international investors, through multiple channels like fintechs, banks, and brokers.

He also stated that the refinery is largely shielded from the economic and currency risks prevalent in the Nigerian economy. Dangote Industries' President, Aliko Dangote, revealed that the IPO aims to expand ownership of the refinery, enabling Nigerians from diverse backgrounds to invest in the business. Investors can subscribe through FCMB branches, business offices, the FCMB Mobile App, and other channels.

The refinery can process around 700,000 barrels of crude oil daily and aims to expand to approximately 1.4 million barrels per day.