Aliko Dangote Borrows N187.6 billion Over Refinery Completion Struggles

The founder of Dangote Industries Limited (DIL), Aliko Dangote, has borrowed N187.6 billion from the debt market to fund the firm’s refinery project, as completion continues to drag.

Dangote refinery has been struggling to kick off, with the company postponing commencement of operation three times in four years, with Fitch Ratings stating in May that another postponement will affect investors confidence in the firm if operation doesn’t start in 2023.

He borrowed the capital from high net-worth investors, asset managers, domestic pension funds, and insurance companies in the bond market through its newly established N300 billion Debt Issuance Programme.

The N187.6 billion bond issuance comes in two tranches; 7-year Tranche-A bond issued at 12.75% and a 10-year Tranche-B bond issued at 13.50%, and will be partly disbursed into the Petroleum Refinery Project.

Group Managing Director of Dangote Industries, Olakunle Alake, said, “Dangote Industries is delighted to have successfully conducted its debut issuance under our newly established Debt Issuance Programme.”

He explained that, “The proceeds from this landmark transaction will be used to part-finance the Dangote Petroleum Refinery Project which is the initiative by the Group to establish the largest refinery in Africa, thus positioning Nigeria as a net exporter of refined crude. We want to specially thank the investor community for their support on this transaction, as well as our various advisors and stakeholders.”