Dangote IPO puts African capital to work
The continent’s largest-ever initial public offering has been embraced by investors from across Africa, the company says.
The Dangote refinery's $1.6 billion share sale attracted investors from across Africa, according to the continent's richest man, Aliko Dangote. This marked a notable instance of Africa's savings flowing across borders to fund major domestic companies, without the need for intermediaries in London or Johannesburg. The refinery's initial public offering, the largest ever on the continent, aimed to fund a $14 billion-plus expansion plan for the massive Lagos State refinery.
The share sale, which valued Dangote's company at nearly $50 billion, is widely seen as a test case for leveraging Africa's domestic savings, estimated at $4 trillion by the multilateral lender Africa Finance Corporation, to deepen the continent's capital markets. However, the deal also posed a challenge to Johannesburg, Africa's most liquid capital market, which has traditionally traded on its status.
The Johannesburg Stock Exchange had previously indicated Dangote had a "strong intent" to list on the South African market. The exchange informed Semafor that local banks were exploring JSE-listed instruments providing exposure to Dangote.
Written by urgent.news from Semafor's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
