FCMB backs Dangote refinery IPO, targets wider participation

FCMB Group Plc. Photo: FCMB

FCMB Group has taken key roles in the initial public offering of Dangote Petroleum Refinery and Petrochemicals FZE, with the oil company offering 4.1 billion ordinary shares at N525 each.

The offer, valued at about N2.15tn if fully subscribed, opened on September 14 and is scheduled to close on October 13.

FCMB Group is participating in the transaction through three operating companies. FCMB Capital Markets is a joint issuing house, CSL Stockbrokers is a stockbroker to the issue, while First City Monument Bank is a receiving bank and distribution agent, according to a statement from the bank.

FCMB Group Chief Executive, Ladi Balogun, said the offer gives Nigerians access to a world-scale business while demonstrating the growing reach of the country’s capital market.

“It presents an opportunity for every Nigerian to experience the benefits of investing in world-class and world-scale businesses that would otherwise be inaccessible,” Balogun said at the opening gong ceremony and Facts Behind the Offer presentation at the Nigerian Exchange in Lagos.

The minimum subscription is 10 shares, allowing individual investors to participate with N5,250. Balogun said Nigeria’s capital market was deepening as it attracted retail, high-net-worth, institutional and international investors through a widening range of channels.

“Retail investors are buying shares on their mobile phones through fintechs, banks and brokers,” he said. “High-net-worth individuals and institutional investors such as pension funds are bringing depth to the market, while international investors are bringing scale.”

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He said the breadth of participation demonstrated the market’s capacity to help credible Nigerian companies raise capital at scale. Balogun also described the refinery as largely insulated from the macroeconomic and currency risks associated with the Nigerian economy.

“The number of such companies on our Exchange is growing,” he said. “This indicates the potential and direction of the Nigerian economy.”

President of Dangote Industries, Aliko Dangote, said the IPO was designed to broaden ownership of the refinery and enable Nigerians across different income and professional groups to invest in the business.

“This is an IPO for the people,” Dangote said. “We want Nigerians across various segments, including drivers, cooks, traders, employees and managers, to have an opportunity to own a stake in the refinery.”

Investors can subscribe through FCMB branches, business offices and the FCMB Mobile App, among other available channels. CSL Stockbrokers can advise retail investors on the potential merits and risks of the investment, while FCMB Capital Markets can advise High Net Worth Individuals and Qualified Investors.

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