Kenyan and East African institutional investors are exploring opportunities to participate in the proposed initial public offering of Dangote Petroleum Refinery, with discussions also focusing on a possible cross-listing of the shares on the Nairobi Securities Exchange.
The engagement brings together key players in Kenya’s investment and capital markets ahead of tomorrow’s groundbreaking ceremony for the Sh2 trillion Dangote East Africa Refinery in Lamu.
Invest Kenya, the investment promotion arm of the Government, participated in the IPO engagement with institutional investors as preparations for the refinery project entered a critical phase.
The proposed IPO is expected to involve 4.1 billion ordinary shares, presenting an opportunity for investors in Kenya and the wider East African region to gain exposure to one of Africa’s major energy investments.
Invest Kenya said discussions on widening regional access to the offering included the possibility of a cross-listing on the Nairobi Securities Exchange.
Such a move could deepen capital-market links between East and West Africa and provide Kenyan and regional investors with greater access to the offering.
The agency said the opportunity went beyond participation in a single transaction, highlighting the need to mobilise Africa’s growing pools of institutional capital towards productive assets on the continent.
Pension funds, asset managers and other long-term investors are increasingly being viewed as an important source of financing for major African infrastructure and industrial projects.
The proposed refinery investment comes as African countries seek to reduce reliance on external financing and increase the role of domestic and regional capital in funding development.
Invest Kenya said the engagement reinforced Kenya’s position as a regional financial and investment hub capable of connecting investors and opportunities across African markets.
“Africa’s growing pools of institutional capital” can play a greater role in financing productive investments in energy, manufacturing, infrastructure and other strategic sectors, the agency said.
The proposed IPO could therefore provide an avenue for investors beyond Nigeria to participate in the refinery, subject to the final terms of the offering and regulatory approvals.
A cross-listing on the NSE would also allow the Kenyan capital market to deepen its links with West African markets and broaden the range of investment opportunities available to local institutional investors.
The discussions come a day before the planned groundbreaking of the Dangote East Africa Refinery in Lamu.
The refinery is expected to process crude oil from Kenya’s Lokichar oilfields in Turkana and other sources before supplying refined petroleum products to regional markets.
The project is expected to position Lamu as an important centre for petroleum-related marine and industrial activity while creating demand for port, logistics and other support services.
Invest Kenya said deeper and more integrated African capital markets would be critical as the continent expands investment in energy, manufacturing, infrastructure and industrial development.
It said mobilising domestic and regional capital would help ensure African investors play a greater role in financing the continent’s economic transformation.
