The initial public offering of Africa’s biggest refinery attracted orders worth more than twice what was targeted, reflecting investor appetite for home-grown industrial firms. Nigerian billionaire Aliko Dangote had aimed to raise around $1.6 billion for the Dangote Refinery company in Africa’s largest-ever share sale, but drew more than $4 billion, Bloomberg reported. In a separate development, the tycoon scrapped plans to list his cement company in the UK, a move that marks a setback for the London Stock Exchange.
The Dangote Refinery IPO marked an opportunity for global investors seeking exposure to one of Africa’s most strategic industrial assets while proving that a significant allocation can be secured from across the continent: Dangote priced individual shares cheaply to attract retail investors.
African policymakers are keen to deepen capital markets to mobilize more of the continent’s domestic resources to fund industrialization and cut borrowing costs. But analysts say byzantine regulations and intra-continental barriers have hampered development of the continent’s capital markets. Nigeria is leading the push to change the status quo: Its finance minister this week laid out proposals that would make it easier to trade bonds across West Africa.
— Alexis Akwagyiram
