The Dangote Petroleum Refinery has raised $750 million through its first Eurobond issuance, marking a major step in its efforts to strengthen its financial position ahead of a planned initial public offering (IPO).
The five-year, dollar-denominated bond, which matures in July 2031, was issued at a yield of 7.5 per cent through a private placement targeted at qualified institutional investors in the United States and other international markets.
The fundraising comes just months after Dangote Fertiliser also secured $750 million through a Eurobond, bringing the Dangote Group’s total international debt raised this year to $1.5 billion.
Analysts said the successful bond sale highlights growing confidence among international investors in the group’s export-driven businesses. They also noted that the refinery was able to secure financing at a lower yield than the earlier fertiliser bond, reflecting improved market confidence as refining operations continue to expand.
The company plans to use the proceeds to refinance short-term and more expensive local loans with longer-term international debt, a move expected to strengthen its balance sheet ahead of its planned IPO.
Reports indicate that the Dangote Group is preparing for a new phase of expansion, which includes a proposed London listing for Dangote Cement and a dual-listing IPO for the refinery.
Meanwhile, the refinery has announced another N50 per litre reduction in its ex-depot petrol price, bringing the price to N1,075 per litre. It said the latest cut is the fourth within one month and increases the total reduction in petrol prices since May 30 to more than N200 per litre.
The company also disclosed that it has reduced the ex-depot price of diesel by N300 per litre and Jet A1 aviation fuel by N520 per litre over the same period.
Dangote Refinery explained that fuel prices do not immediately reflect movements in global crude oil prices because crude is purchased several weeks or months before it is refined. It added that it has absorbed part of the higher production costs to reduce the impact on consumers and expressed optimism that fuel prices could decline further as lower-cost crude replaces earlier, more expensive supplies.
